EXHIBIT 10.10


 




 





 


AGREEMENT AND PLAN OF MERGER


 


BY AND AMONG


 


SSA GLOBAL TECHNOLOGIES, INC.,


 


SENECA MERGER SUBSIDIARY INC.,


 


SENECA ACQUISITION SUBSIDIARY INC.


 


AND


 


ELEVON, INC.


 


 


Dated as of May 8, 2003


 




 




















 


Table of Contents


 


	
  ARTICLE I DEFINITIONS

  	
   

  
	
   

  	
   

  
	
  ARTICLE II MERGER AND ASSET PURCHASE

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 2.1.

  	
  The
  Merger

  	
   

  
	
  Section 2.2.

  	
  Effective Time of the Merger

  	
   

  
	
  Section 2.3.

  	
  Officers

  	
   

  
	
  Section 2.4.

  	
  Asset
  Purchase

  	
   

  
	
  Section 2.5.

  	
  Closing

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III CONVERSION OF SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 3.1.

  	
  Conversion of Capital Stock

  	
   

  
	
  Section 3.2.

  	
  Payment of Cash Merger Consideration.

  	
   

  
	
  Section 3.3.

  	
  Appraisal
  Rights

  	
   

  
	
  Section 3.4.

  	
  Stock Options and Restricted Stock

  	
   

  
	
  Section 3.5.

  	
  Employee Stock Purchase Plan

  	
   

  
	
  Section 3.6.

  	
  Further Assurances

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV REPRESENTATIONS AND WARRANTIES
  OF THE COMPANY

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 4.1.

  	
  Organization

  	
   

  
	
  Section 4.2.

  	
  Capitalization

  	
   

  
	
  Section
  4.3.

  	
  Authorization; Validity of Agreement;
  Company Action

  	
   

  
	
  Section 4.4.

  	
  Consents and Approvals; No Violations

  	
   

  
	
  Section 4.5.

  	
  SEC Reports and Financial Statements

  	
   

  
	
  Section 4.6.

  	
  No Undisclosed Liabilities

  	
   

  
	
  Section 4.7.

  	
  Absence of Certain Changes

  	
   

  
	
  Section 4.8.

  	
  Taxes

  	
   

  
	
  Section
  4.9.

  	
  Title to Properties; Owned and Leased Real
  Properties; No Liens

  	
   

  
	
  Section 4.10.

  	
  Intellectual Property

  	
   

  
	
  Section 4.11.

  	
  Products

  	
   

  
	
  Section
  4.12.

  	
  Agreements, Contracts and Commitments

  	
   

  
	
  Section 4.13.

  	
  Litigation

  	
   

  
	
  Section 4.14.

  	
  Environmental Matters

  	
   

  
	
  Section 4.15.

  	
  Employee Benefit Plans

  	
   

  
	
  Section 4.16.

  	
  Compliance with Laws

  	
   

  
	
  Section 4.17.

  	
  Permits and Licenses

  	
   

  
	
  Section 4.18.

  	
  Labor
  Matters

  	
   

  
	
  Section 4.19.

  	
  Insurance

  	
   

  
	
  Section 4.20.

  	
  Information in Proxy Statement

  	
   

  
	
  Section 4.21.

  	
  Opinion of Financial Advisor

  	
   

  
	
  Section 4.22.

  	
  Brokers

  	
   

  
	
  Section 4.23.

  	
  Voting Requirements

  	
   

  



 


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  Section 4.24.

  	
  Rights
  Agreement

  	
   

  
	
  Section 4.25.

  	
  State Takeover Statutes

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  V REPRESENTATIONS AND WARRANTIES OF PARENT, 
  ACQUISITION SUBSIDIARY AND MERGER SUBSIDIARY

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 5.1.

  	
  Organization

  	
   

  
	
  Section
  5.2.

  	
  Authorization; Validity of Agreement;
  Necessary Action

  	
   

  
	
  Section 5.3.

  	
  Consents and Approvals; No Violations

  	
   

  
	
  Section 5.4.

  	
  Sufficiency of Funds

  	
   

  
	
  Section 5.5.

  	
  Information in Proxy Statement

  	
   

  
	
  Section 5.6.

  	
  Litigation

  	
   

  
	
  Section
  5.7.

  	
  Ownership of Merger Subsidiary; No Prior
  Activities

  	
   

  
	
  Section 5.8.

  	
  Brokers

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 6.1.

  	
  Interim Operations of the Company

  	
   

  
	
  Section 6.2.

  	
  Confidentiality

  	
   

  
	
  Section 6.3.

  	
  No Solicitation of Other Offers

  	
   

  
	
  Section 6.4.

  	
  Access to Information

  	
   

  
	
  Section 6.5.

  	
  Special Meeting

  	
   

  
	
  Section 6.6.

  	
  Proxy Statement

  	
   

  
	
  Section 6.7.

  	
  Cooperation

  	
   

  
	
  Section 6.8.

  	
  Public Disclosure

  	
   

  
	
  Section 6.9.

  	
  Notification of Certain Matters

  	
   

  
	
  Section 6.10.

  	
  Rights Agreement

  	
   

  
	
  Section 6.11.

  	
  Subsequent Filings

  	
   

  
	
  Section 6.12.

  	
  Communication to Employees

  	
   

  
	
  Section
  6.13.

  	
  Indemnification of Officers and Directors;
  Exculpation

  	
   

  
	
  Section 6.14.

  	
  Employee Benefits

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII CONDITIONS TO EFFECT THE MERGER

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  7.1.

  	
  Conditions to Each Party’s Obligation to
  Effect the Transactions

  	
   

  
	
  Section
  7.2.

  	
  Conditions to Parent’s, Merger Subsidiary’s
  and Acquisition Subsidiary’s Obligation to Effect the Transactions

  	
   

  
	
  Section
  7.3.

  	
  Conditions to the Company’s Obligation to
  Effect the Transactions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII TERMINATION

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 8.1.

  	
  Termination

  	
   

  
	
  Section 8.2.

  	
  Effect of Termination

  	
   

  
	
  Section 8.3.

  	
  Fees and Expenses

  	
   

  
	
  Section 8.4.

  	
  Amendment

  	
   

  
	
  Section 8.5.

  	
  Extension; Waiver

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  9.1.

  	
  Nonsurvival of Representations and
  Warranties

  	
   

  



 


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  Section 9.2.

  	
  Notices

  	
   

  
	
  Section 9.3.

  	
  Entire Agreement

  	
   

  
	
  Section 9.4.

  	
  No Third Party Beneficiaries

  	
   

  
	
  Section 9.5.

  	
  Assignment

  	
   

  
	
  Section 9.6.

  	
  Interpretation

  	
   

  
	
  Section 9.7.

  	
  Counterparts

  	
   

  
	
  Section 9.8.

  	
  Severability

  	
   

  
	
  Section 9.9.

  	
  Governing Law

  	
   

  
	
  Section 9.10.

  	
  Submission to Jurisdiction

  	
   

  
	
  Section 9.11.

  	
  Remedies; Specific Performance

  	
   

  
	
  Section 9.12.

  	
  Waiver of Jury Trial

  	
   

  



 


Exhibit A – Form of Voting
Agreement


Exhibit B – Form of Certificate
of Incorporation of Surviving Corporation


Exhibit C – Form of Bill of
Sale


Exhibit C-1 – Form of
Assignment of Trademarks


 


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AGREEMENT AND PLAN OF MERGER


 


This AGREEMENT
AND PLAN OF MERGER (this “Agreement”),
dated as of May 8, 2003, is made by and among SSA Global Technologies, Inc., a
Delaware corporation (“Parent”),
Seneca Merger Subsidiary Inc. a Delaware corporation and an indirect
wholly-owned subsidiary of Parent (“Merger
Subsidiary”), Seneca Acquisition Subsidiary Inc. a Delaware
corporation and an indirect wholly-owned subsidiary of Parent (“Acquisition Subsidiary”), and Elevon, Inc.,
a Delaware corporation (the “Company”).  Parent, Merger Subsidiary, Acquisition Subsidiary
and the Company are each individually referred to herein as a “Party” and together collectively referred
to herein as the “Parties”.


 


W  I  T  N  E  S
S  E  T  H:


 


WHEREAS, the
respective Boards of Directors of the Company, Parent and Merger Subsidiary have
declared this Agreement advisable and approved the merger of Merger Subsidiary
with and into the Company, with the Company surviving (the “Merger”), upon the terms and subject to the
conditions set forth in this Agreement and the Delaware General Corporation
Law, as such law is in effect from time to time (the “DGCL”);


 


WHEREAS, the
respective Boards of Directors of Parent, the Merger Subsidiary and the Company
have determined that the Merger is in the interest of their respective
stockholders;


 


WHEREAS, the
respective Boards of Directors of the Parent, Acquisition Subsidiary and the
Company have approved the Asset Purchase (as hereinafter defined), upon the
terms and subject to the conditions set forth herein and in the DGCL;


 


WHEREAS, as
inducement and a condition to Parent’s and Acquisition Subsidiary’s willingness
to enter into this Agreement, the respective Boards of Directors of Parent,
Acquisition Subsidiary and the Company have determined that the Asset Purchase
is in the interest of their respective stockholders; and


 


WHEREAS, as
inducement and a condition to Parent’s willingness to enter into this
Agreement, Parent, the Company and certain of the Company Stockholders are
entering into a voting agreement and irrevocable proxy, dated as of the date
hereof, substantially in the form as that attached hereto as Exhibit A
(the “Voting Agreement”), pursuant
to which the Company Stockholders party thereto have agreed, among other
things, to vote the shares of Company Common Stock held by them in favor of the
adoption of this Agreement.


 


NOW,
THEREFORE, in consideration of the foregoing and the representations,
warranties, covenants and agreements set forth below, the Parties agree as
follows:


 

















 


ARTICLE I


 


DEFINITIONS


 


For purposes
of this Agreement the following terms shall have the meanings set forth below:


 


“Acquisition Agreement” shall mean any
letter of intent, agreement in principle, acquisition agreement, voting
agreement, stock purchase agreement or other similar agreement relating to an
Acquisition Proposal.


 


“Acquisition Proposal” shall mean (a) any
inquiry, proposal or offer (including any proposal to stockholders of the
Company) from any Person or group relating to any direct or indirect
acquisition or purchase of 15% or more of the consolidated assets of the
Company and its Subsidiaries or 15% or more of any class of equity securities
of the Company or any of its Subsidiaries in a single transaction or a series
of related transactions, (b) any tender offer (including a self-tender offer)
or exchange offer that, if consummated, would result in any Person or group
beneficially owning 15% or more of any class of equity securities of the
Company or any of its Subsidiaries or the filing with the SEC of a registration
statement under the Securities Act or any statement, schedule or report under
the Exchange Act in connection therewith, (c) any merger, consolidation,
business combination, recapitalization, liquidation, dissolution or similar
transaction involving the Company or any of its Subsidiaries, (d) any other
transaction the consummation of which could reasonably be expected to
materially impede, prevent or materially delay consummation of the Transactions
or (e) any public announcement by or on behalf of the Company, any of its
Subsidiaries or any of their respective Affiliates (or any of their respective
Representatives) or by any third party of a proposal, plan or intention to do
any of the foregoing or any agreement to engage in any of the foregoing.


 


“Action or Proceeding” shall mean actions,
suits, proceedings, pleadings, claims, arbitrations, investigations, charges,
allegations, complaints or demands.


 


“Affiliate” shall have the meaning set forth
in Rule 12b-2 of the Exchange Act.


 


“Ancillary Agreements” shall mean all
agreements entered into by and between the Company, on the one hand, and Parent
and/or Merger Subsidiary, on the other hand, in connection with the
Transactions, including, without limitation, the Voting Agreement.


 


“Ancillary Product Materials” shall mean all
Documentation currently used or distributed by the Company concerning the
Products, including customer support materials such as support training
materials, support bulletins, and any and all data contained in the customer
support organization computer system of the Company; and marketing materials
relating to the Products, including sale and marketing collateral, white
papers, Product data sheets known as “Software Product Descriptions,”
performance benchmark reports, customer training materials, sales training
materials and sales presentation materials.


 


“Appraisal Shares” shall mean Company Common
Stock outstanding immediately prior to the Effective Time that are held by any
Person that shall not have voted such Company Common Stock in favor of, or
consented in writing to, the Merger and shall have 


 


2

















 


timely and properly demanded in writing appraisal of such Company
Common Stock in accordance with Section 262 of the DGCL.


 


“Benefit Plans” shall mean each retirement,
pension, savings, bonus, stock purchase, profit sharing, stock option, deferred
compensation, severance or termination pay, insurance, death, medical,
hospital, dental, vision care, drug, sick leave, disability, salary
continuation, vacation, incentive or other compensation plan or arrangement or
other employee benefit that the Company and its Subsidiaries currently maintain
or to which the Company and its Subsidiaries currently contribute or are
required to contribute or had an obligation to contribute for the last 6 years
with respect to any Pension Plan (as defined below) for the benefit of any of
its employees or former employees (or dependents or beneficiaries thereof) (or
as to which the Company and its Subsidiaries may otherwise have any liability,
including, but not limited to, any pension plan (“Pension Plan”) as defined in Section 3(2) of ERISA, any
welfare plan (“Welfare Plan”) as
defined in Section 3(1) of ERISA or any program administered by a government,
including, but not limited to, a Foreign Pension Plan, whether funded, insured
or self-funded or whether written or oral.


 


“Business Day” shall mean any day except a
Saturday, Sunday or any other day on which commercial banks are required or
authorized to be closed in New York, New York.


 


“CAA” shall have the meaning ascribed to
such term within the definition of Environmental Law.


 


“CERCLA” shall have the meaning ascribed to
such term within the definition of Environmental Law.


 


“Code” shall mean the Internal Revenue Code
of 1986, as amended, and the rules and regulations promulgated thereunder.


 


“Company Common Stock” shall mean the common
stock, par value $0.001 per share, of the Company.


 


“Company Material Adverse Effect” shall mean
any event, change, occurrence, effect, fact, violation, development or
circumstances having or resulting in, individually or in the aggregate, a
material adverse effect on (a) the ability of the Company to duly perform its
obligations under this Agreement or to consummate the transactions contemplated
hereby on a timely basis or (b) the business, properties, assets (both tangible
and intangible), liabilities, condition (financial or otherwise), results of
operations or prospects of the Company and its Subsidiaries, taken as a whole;
provided,  however, that none of the following
shall be deemed in themselves, either alone or in combination, to constitute,
and none of the following shall be taken into account in determining whether
there has been or will be, a Company Material Adverse Effect: (A) any change in
the market price or trading volume of the Company’s stock after the date
hereof, provided that any underlying event, change, occurrence, effect,
development or circumstance that gave rise to such change in market price or
trading volume shall be taken into account in determining whether there has
been or would be a Company Material Adverse Effect, except as otherwise
provided in this paragraph; (B) any failure by the Company to meet internal
projections or forecasts or published revenue or earnings predictions for any
period ending (or 


 


3

















 


for which revenues or earnings are released) on or after the date of
this Agreement, provided that any underlying event, change, occurrence,
effect, development or circumstance that gave rise to such failure shall be
taken into account in determining whether there has been or would be a Company
Material Adverse Effect, except as otherwise provided in this paragraph; (C)
any adverse event, change, occurrence, effect, development or circumstance
resulting primarily from the announcement or pendency of the Merger (including
any cancellations of or delays in customer orders, any reduction in sales, any
disruption in supplier, distributor, partner or similar relationships or any
loss of employees); (D) any adverse event, change, occurrence, effect,
development or circumstance resulting primarily from any action or inaction by
Parent or Merger Subsidiary (including any cancellations of or delays in
customer orders, any reduction in sales, any disruption in supplier,
distributor, partner or similar relationships or any loss of employees); (E)
any adverse event, change, occurrence, effect, development or circumstance
attributable to conditions affecting the industries in which the Company participates,
the U.S. economy as a whole or foreign economies in any locations where the
Company or any of its Subsidiaries has material operations or sales, including
any such conditions arising out of acts of terrorism or war or any armed
hostilities to the extent such acts of terrorism or war or armed hostilities do
not directly affect the Company or its employees or assets; (F) any adverse
event, change, occurrence, effect, development or circumstance resulting
primarily from (i) out-of-pocket fees and expenses (including legal,
accounting, investment banking and other fees and expenses) incurred in
connection with the transactions contemplated by this Agreement, or (ii) the
payment of any amounts due to, or the provision of any other benefits
(including benefits relating to acceleration of stock options) to, any officers
or employees under, employment contracts, noncompetition agreements, employee
benefit plans, severance arrangements or other arrangements in existence as of
the date of this Agreement or entered into after the date hereof as permitted
by this Agreement; or (G) any adverse event, change, occurrence, effect,
development or circumstance resulting primarily from or relating primarily to
compliance with the terms of, or the taking of any action required by, or the
failure to take any action prohibited by, this Agreement.


 


“Company Permits” shall mean permits,
approvals, licenses, authorizations, certificates, rights, exemptions, orders
and franchises from Governmental Entities necessary for the ownership of assets
and the lawful conduct of the business of the Company and its Subsidiaries as
now conducted and as currently contemplated.


 


“Company Real Property” shall mean,
collectively, the Leased Real Property.


 


“Company SEC Documents” shall mean all forms,
reports, schedules, statements and other documents (including, in each case,
exhibits, schedules, amendments or supplements thereto, and any other
information incorporated by reference therein) required to be filed with the
SEC by the Company since January 1, 2000 under the Exchange Act or the
Securities Act (as such documents have been amended or supplemented between the
time of their respective filing and the date of this Agreement).


 


“Company Stockholders” shall mean the record
holders of the Company Common Stock.


 


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“Computer Software”
shall have the meaning ascribed to such term within the definition of
Intellectual Property.


 


“Confidentiality Agreement” shall mean the
Confidentiality Agreement, dated as of February 21, 2003, by and between the
Company and Parent, as in effect from time to time.


 


“Contract(s)” shall mean any contract,
agreement, instrument, arrangement, guarantee, license, executory commitment or
understanding that is binding on the Company or any of its Subsidiaries.


 


“Copyrights” shall have the meaning ascribed
to such term within the definition of Intellectual Property.


 


“Customer Agreement” shall mean a written
agreement currently in effect between the Company and a customer of the Company
with respect to a Product, under which the Company (i) is currently receiving
revenue, or (ii) has received revenue within the last two years.


 


“CWA” shall have the meaning ascribed to
such term within the definition of Environmental Law.


 


“Disabling Devices” shall mean Computer
Software viruses, time bombs, logic bombs, Trojan horses, trap doors, back
doors, or other computer instructions, intentional devices or techniques that
are designed to threaten, infect, assault, vandalize, defraud, disrupt, damage,
disable, maliciously encumber, hack into, incapacitate, infiltrate or slow or
shut down a computer system or any component of such computer system, including
any such device affecting system security or compromising or disclosing user
data.


 


“Documentation” shall mean all documentation
(including data entry and data processing procedures, report generation and
quality control procedures), logic and designs for all programs, algorithms,
edit controls, methodologies, flow charts and file layouts and written
narratives of all procedures used in the coding, operation or maintenance of
and customer support with respect to a Product.


 


“Environmental Law” includes the
Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), 42 U.S.C. 9601 et seq., as
amended, the Clean Air Act (“CAA”),
42 U.S.C. 7401 et seq., as amended, the Clean Water Act (“CWA”), 33 U.S.C. 1251 et seq., as amended,
the Occupational Safety and Health Act (“OSHA”),
29 U.S.C. 655 et seq., and any other federal, state, local or municipal laws,
statutes, regulations, rules or ordinances imposing liability or establishing
standards of conduct for protection of the environment.


 


“Environmental Permits” shall mean,
collectively, all permits, licenses and/or approvals required under
Environmental Laws to operate the business of the Company and its Subsidiaries
as currently operated and as contemplated in material compliances with all
Environmental Laws.


 


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“ERISA” shall mean the Employee Retirement
Income Security Act of 1974, as amended.


 


“ERISA Affiliates” shall mean any entity
which, together with Parent, Merger Subsidiary and the Company, as the case may
be, would be treated as a single employer under Section 414(b), (c), (m) or (o)
of the Code.


 


“Exchange Act” shall mean the Securities
Exchange Act of 1934, as amended, including the rules and regulations
promulgated thereunder.


 


“Foreign Pension Plan” shall mean any plan,
fund (including any superannuation fund) or other similar program established
or maintained by the Company, any Subsidiary of the Company or any of the
Company’s Affiliates outside the United States of America primarily for the
benefit of employees of the Company or any of the Subsidiaries of the Company
residing outside the United States of America, which fund or similar program
provides, or results in, retirement income, a deferral of income in
contemplation of retirement or payments to be made upon termination of
employment, and which plan is not subject to ERISA or the Code.


 


“GAAP” shall mean United States generally
accepted accounting principles applied on a consistent basis during the periods
involved.


 


“Governmental Approval” shall mean any
required filing, recordation, declaration or registration with, or permit,
order, authorization, consent or approval of, or action by or in respect of, or
the giving of notice to, any Governmental Entity.


 


“Governmental Directive” shall mean any
judgment, order, decree or directive by or at the request of any Governmental
Entity.


 


“Governmental Entity” shall mean any
federal, state, local or foreign government, court, arbitral tribunal,
administrative agency, body or commission or other governmental or other
regulatory authority, commission, agency or body or any non-governmental,
self-regulatory authority, commission, agency or body.


 


“Intellectual Property” shall mean all
foreign and domestic (i) trademarks, service marks, brand names, certification
marks, collective marks, d/b/a’s, Internet domain names, logos, symbols, trade
dress, assumed names, fictitious names, trade names, all applications and
registrations for all of the foregoing, and all goodwill associated therewith
and symbolized thereby, including all extensions, modifications and renewals of
same (collectively, “Trademarks”);
(ii) patents, registrations, and applications therefor, including divisions,
continuations, continuations-in-part and renewal applications, and including
renewals, extensions and reissues (collectively, “Patents”); (iii) confidential and proprietary information,
trade secrets and know-how, including processes, schematics, databases,
formulae, drawings, prototypes, models, designs and customer lists
(collectively, “Trade Secrets”);
(iv) published works of authorship (including computer software), copyrights
therein and thereto, and registrations and applications therefor, and all
renewals, extensions, restorations and reversions thereof (collectively, “Copyrights”); (v) proprietary computer
software used by the Company in connection with its business (including all
computer programs, object code, source code, user interface, and data bases)
(collectively, “Computer Software”);
and (vi) all claims or causes of 


 


6

















 


action arising out of or related to any infringement, misappropriation
or other violation of any of the foregoing, including rights to recover for
past, present and future violations thereof (collectively, “Other Proprietary Rights”).


 


“Knowledge”, with respect to any individual
(and with respect to any other Person, the executive officers of such Person
and its subsidiaries) shall mean the actual knowledge of such individual (and
with respect to any other Person, the executive officers of such Person and its
subsidiaries) after reasonable inquiry.


 


“Laws” shall mean (i) any provisions of any
federal, state, local or foreign statute, law, rule, regulation or ordinance
applicable to a Person and (ii) any order, judgment, writ, injunction or decree
entered by a Governmental Entity naming a Person or binding on such Person or
its business or assets.


 


“Leased Real Property” shall mean,
collectively, all real property leased, subleased or licensed by the Company or
any of its Subsidiaries (as lessor or lessee or under which the Company or any
of its Subsidiaries has any liability).


 


“Licensed Intellectual Property” shall mean
all third party Intellectual Property that the Company is licensed or otherwise
permitted by other Persons to use, distribute, resell, sublicense or otherwise
commercially exploit.


 


“Licensed Intellectual Property Agreement”
shall mean all agreements concerning the Licensed Intellectual Property.


 


“Liens” shall mean any pledges, claims,
equities, options, liens, charges, mortgages, easements, rights-of-way, call rights,
rights of first refusal, “tag-” or “drag-” along rights, encumbrances, security
interests or other similar restrictions of any kind or nature whatsoever.


 


“Merger Subsidiary Common Stock” shall mean
the common stock, par value $0.01 per share, of Merger Subsidiary.


 


“Options” shall mean any options to purchase
Company Common Stock outstanding as of the Closing Date in accordance with the
Company’s Stock Plans.


 


“OSHA” shall have the meaning ascribed to
such term within the definition of Environmental Law.


 


“Other Proprietary Rights” shall have the
meaning ascribed to such term within the definition of Intellectual Property.


 


“Owned Intellectual Property” shall mean
Intellectual Property owned by the Company or the Subsidiaries.


 


“Owned Real Property” shall mean all real
property owned in whole or in part by the Company or any of its Subsidiaries.


 


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“Patents” shall have the meaning ascribed to
such term within the definition of Intellectual Property.


 


“Paying Agent” shall mean the bank or trust
company, which shall be located in the United States of America, designated by
Parent (with the consent of the Company, not to be unreasonably withheld or
delayed) to act as paying agent for the holders of Certificates in connection
with the Merger and to receive the funds to which holders of Certificates shall
become entitled pursuant to Section 3.1(c).


 


“Payment Fund” shall mean cash in an
aggregate amount which (i) is equal to (a) the aggregate Cash Merger Consideration
payable in accordance with Section 3.1(c) and (ii) is sufficient to enable the
Paying Agent to make payments pursuant to Sections 3.1(c) and 3.2, which funds
prior to disbursement in accordance with the terms of this Agreement shall be
invested by the Paying Agent as directed by the Parent.


 


“Pension Plan” shall have the meaning
ascribed to such term within the definition of Benefit Plans.


 


“Permitted Lien(s)” shall mean (a) Liens
reflected in the Company’s consolidated balance sheet as of December 31, 2002
contained in the Company SEC Documents (including the notes thereto), (b) Liens
consisting of zoning or planning restrictions, easements, permits and other
restrictions or limitations on the use of real property or irregularities in
title thereto that do not materially detract from the value of, or materially
impair the use of, such property by the Company or any of its Subsidiaries in
the operation of their respective business, (c) Liens of carriers,
warehousemen, mechanics, suppliers, materialmen or repairmen arising in the
ordinary course of business which are not material in amount or which are set
forth on Schedule 1.1(c) or (d) Liens for taxes, assessments or governmental
charges or levies on property not yet due and delinquent or being contested in
good faith by appropriate proceedings which are not material in amount or which
are set forth on Schedule 1.1(d), to the extent that all of such Liens referred
to in preceding clauses (a) through (d), inclusive, do not have a Company
Material Adverse Effect.


 


“Person(s)” shall mean and include an
individual, a partnership (general or limited), a joint venture, a corporation,
a trust, an estate, a limited liability company, an association, a joint-stock
company,  an unincorporated organization
or other entity and a Governmental Entity, government or other department or
agency thereof.


 


“Products” shall mean the Computer Software
products marketed, sold, licensed, supported, serviced or maintained by the
Company or its Subsidiaries, together with the inventory of the Products, the
Ancillary Product Materials and any and all such Computer Software related to,
comprising or constituting such products, and all supplements, modifications,
updates, corrections and enhancements to past and current versions of such
products and shipping versions of such products, in existence as of the date
hereof, and versions of such products currently under development; and any and
all English and foreign language versions of current and past versions of such
products, shipping versions of such products and versions of such products
currently under development, in each case, to the extent applicable, including
the source code and object code versions of such Computer Software; and all
Documentation relating thereto; and any and all back-up tapes and archival
tapes relating to the 


 


8

















 


foregoing; provided, however, that the term “Products” shall not
include any of the foregoing to the extent (i) related to the discontinued
product commonly known as “Rarevision” or (ii) the Company has previously sold,
assigned, or otherwise transferred its rights to any product or product line to
any Person, including without limitation, those products commonly known as E5,
IMMPOWER and Aptos.


 


“Proxy Statement” shall mean the definitive
proxy statement of the Company mailed to its stockholders relating to the
Transactions and this Agreement, as amended or supplemented.


 


“Registered” shall mean issued, registered,
renewed or the subject of a pending application.


 


“Representative(s)” shall mean with respect
to any Person, such Person’s Affiliates, officers, directors, employees,
representatives, consultants, investment bankers, attorneys, accountants and
other agents.


 


“Required Asset Purchase Consents”
shall mean, collectively, all approvals, consents or waivers under each of the
Company Material Contracts that may be required under the terms thereof with
respect to the Asset Purchase.


 


“Required Merger Consents” shall mean,
collectively, all approvals, consents or waivers under each of the Company
Material Contracts that may be required under the terms thereof with respect to
the Merger and the other transactions contemplated hereby (other than the Asset
Purchase).


 


“Rights Agreement” shall mean that certain
Rights Agreement, dated as of June 1, 2000, between the Company and Fleet
National Bank, a National Banking Association, as rights agent thereunder, as
amended on August 7, 2001 and in effect on the date of this Agreement and
without giving effect to any amendments, modifications or supplements after the
date of this Agreement.


 


“SEC” shall mean the United States
Securities and Exchange Commission.


 


“Securities Act” shall mean the Securities
Act of 1933, as amended, including the rules and regulations promulgated
thereunder.


 


“Special Meeting” shall mean a special
meeting of the stockholders of the Company for the purpose of considering and
taking action upon the adoption of this Agreement and the approval of the
Merger and the Asset Purchase.


 


“Stock Plans” shall mean the Company’s:  (a) 1989 Employee Stock Option Plan and
related forms of Incentive Stock Option Grant and Supplemental Stock Option
Grant; (b) 1993 Non-Employee Directors’ Stock Option Plan, as amended; (c) 2002
Equity Incentive Plan (formerly the 1994 Equity Incentive Plan); (d) 1995
Non-Statutory Stock Option Plan for Non-Officer Employees, as amended; and (e)
any other stock option or restricted stock plan or agreement of the Company
including but not limited to the 1982 Incentive Stock Option Plan and the 1986
Supplemental Stock Option Plan.


 


9

















 


“Subsequent Filings” means, collectively,
all subsequent filings made after the date of this Agreement amending or
superseding any Company SEC Documents (including any statements or schedules
therein) and any forms, reports, schedules, statements, registration
statements, proxy statements, or other documents (including in each case,
exhibits, schedules, amendments or supplements thereto, and any other
information incorporated by reference therein) filed with the SEC after the
date of this Agreement.


 


“Subsidiary” shall mean, with respect to any
Person at any time, any partnership (general or limited), joint venture,
corporation, trust, estate, limited liability company, association, joint-stock
company, unincorporated organization or other entity of which (or in which)
more than 50% of (a) the issued and outstanding shares of capital stock having
ordinary voting power to elect a majority of the board of directors of such
corporation (irrespective of whether at the time shares of capital stock of any
other class or classes of such corporation shall or might have voting power
upon the occurrence of any contingency), (b) the interest in the capital or profits
of such partnership, joint venture, association, joint stock company,
unincorporated organization, limited liability company or other entity, or (c)
the beneficial interest in such trust or estate, is, at such time, directly or
indirectly owned or controlled by such Person, by such Person and one or more
of its other Subsidiaries or by one or more of such Person’s other
Subsidiaries.


 


“Superior Proposal” shall mean a bona fide
written offer which is not solicited after the date hereof in violation of this
Agreement by or on behalf of the Company, any of its Subsidiaries or any of
their respective Affiliates (or any of their respective Representatives) made
by any Person to acquire, directly or indirectly, (i) more than 50% of the
shares of Company Common Stock pursuant to a tender offer followed by a merger,
(ii) all of the shares of Company Common Stock pursuant to a merger or (iii)
all or substantially all of the assets of the Company and its Subsidiaries, (x)
on terms (taken as a whole) which the Board of Directors of the Company
determines in good faith, after consultation with its outside nationally
recognized legal counsel (which may be its current outside legal counsel) and a
financial advisor of nationally recognized reputation (which may be its current
financial advisor), would, if consummated, be more favorable from a financial
point of view to the Company and its stockholders (in their capacity as such)
than the transactions contemplated hereby and (y) which the Board of Directors
determines in good faith (after consultation with outside nationally recognized
legal counsel (which may be its current outside legal counsel) and a financial
advisor of nationally recognized reputation (which may be its current financial
advisor)) is reasonably capable of being consummated (taking into account such
factors as the Board of Directors of the Company in good faith deems relevant,
including all legal, financial, regulatory and other aspects of such proposal
(including the terms of any financing, the likelihood of obtaining any
necessary financing in a timely manner and the likelihood that the proposed
transaction would be consummated) and the identity of the Person making such
proposal).


 


“Tax Return” shall mean any tax return,
statement, form or report (including any election, declaration, disclosure,
schedule, estimate and information Tax return and other information required to
be supplied to a taxing authority in connection with any Tax) relating to any
Tax.


 


10

















 


“Tax” shall mean any tax, charge, duty, fee,
levy or other similar assessment or liability (whether payable directly or by
withholding and whether or not requiring the filing of a Tax Return), including
income, gross receipts, ad valorem, premium, value-added, excise, real
property, personal property, sales, use, services, transfer, withholding,
employment, payroll, franchise, profits, capital gains, capital stock,
occupation, severance, windfall profits, stamp, license, social security and
other taxes imposed by the United States or any state, local or foreign
government, or any agency thereof, or other political subdivision of the United
States or any such government, and any interest, fine, penalty, assessment or
addition to tax resulting from, attributable to or incurred in connection with
any of the foregoing.


 


“Trade Secrets” shall have the meaning
ascribed to such term within the definition of Intellectual Property.


 


“Trademarks” shall have the meaning ascribed
to such term within the definition of Intellectual Property.


 


“Transactions” shall mean the transactions
contemplated by this Agreement, and the Ancillary Agreements including, without
limitation, the Merger and the Asset Purchase.


 


“Transfer Regulations” shall means the
Transfer of Undertakings (Protection of Employment) Regulations 1981 or such
legislation enacted in an relevant jurisdictions pursuant to the EC Directive
77/187/EEC (the “Acquired Rights Directive”).


 


“U.S. Benefit Plan” shall mean each Benefit
Plan covering, or providing benefits to, employees of the Company and its
Subsidiaries based in the United States or to which ERISA or the Code is
applicable.


 


“Voting Debt” shall mean, collectively,
bonds, debentures, notes or other indebtedness or obligations which entitle the
holders thereof to vote (or which are convertible into or exercisable or
exchangeable for securities which entitle the holders thereof to vote) with the
stockholders of the Company or a Subsidiary of the Company, as the case may be,
on any matter.


 


“Voting Stockholders” shall mean the Company
Stockholders who are party to the Voting Agreement.


 


“WARN Act” shall mean the Workers Adjustment
Retraining Notification Act, 29 U.S.C. §§ 2101, et  seq.


 


“Welfare Plans” shall have the meaning
ascribed to such term within the definition of Benefit Plans.


 


In addition to
the foregoing definitions, the following terms shall have the definitions
specified in the section of the Agreement listed below:


 


11

















 


	
  Defined Terms

  	
   

  	
  Section

  
	
   

  	
   

  	
   

  
	
  Agreement

  	
   

  	
  Preamble

  
	
  Asset
  Purchase  Documents

  	
   

  	
  2.5(d)(ii)

  
	
  Cash Merger
  Consideration

  	
   

  	
  3.1(c)

  
	
  Cash Merger
  Shares

  	
   

  	
  3.1(c)

  
	
  Certificate
  of Merger

  	
   

  	
  2.2

  
	
  Certificates

  	
   

  	
  3.2(b)(i)

  
	
  Closing

  	
   

  	
  2.5

  
	
  Closing Date

  	
   

  	
  2.5

  
	
  COBRA

  	
   

  	
  4.15(b)

  
	
  Company

  	
   

  	
  Preamble

  
	
  Company
  Disclosure Letter

  	
   

  	
  Article IV

  
	
  D&O
  Insurance

  	
   

  	
  6.13(b)

  
	
  DGCL

  	
   

  	
  Recitals

  
	
  Effective
  Time

  	
   

  	
  2.2

  
	
  Environmental
  Claim

  	
   

  	
  4.14

  
	
  Expense
  Reimbursement

  	
   

  	
  8.3(b)(ii).  8.3(b)(ii)

  
	
  Insurance
  Policies

  	
   

  	
  4.19

  
	
  Merger

  	
   

  	
  Recitals

  
	
  Merger
  Subsidiary

  	
   

  	
  Preamble

  
	
  Option
  Consideration

  	
   

  	
  3.4

  
	
  Parent

  	
   

  	
  Preamble

  
	
  Parties

  	
   

  	
  Preamble

  
	
  Party

  	
   

  	
  Preamble

  
	
  Preferred
  Stock

  	
   

  	
  4.2

  
	
  Purchase
  Plan

  	
   

  	
  3.5

  
	
  Purchase
  Plan Termination Date

  	
   

  	
  3.5

  
	
  Purchased
  Assets

  	
   

  	
  2.4

  
	
  SEC
  Contracts

  	
   

  	
  4.12

  
	
  Stock
  Incentive Plans

  	
   

  	
  3.4

  
	
  Surviving
  Corporation

  	
   

  	
  2.1

  
	
  Termination
  Date

  	
   

  	
  8.1(b)

  
	
  Termination
  Fee

  	
   

  	
  8.3(b)(ii)

  
	
  Voting
  Agreement

  	
   

  	
  Recitals

  



 


12

















 


ARTICLE II


 


MERGER AND ASSET PURCHASE


 


Section
2.1.            The Merger. 
Upon the terms and subject to the conditions set forth in this
Agreement, and in accordance with the DGCL, at the Effective Time, Parent,
Merger Subsidiary and the Company shall consummate the Merger pursuant to which
(a) Merger Subsidiary shall be merged with and into the Company and the
separate corporate existence of Merger Subsidiary shall cease, (b) the Company
shall be the successor or surviving corporation in the Merger (the “Surviving Corporation”) and shall continue
to be governed by the DGCL, (c) the separate corporate existence of the Company
with all of its rights, powers and franchises shall continue unaffected by the
Merger, (d) the Amended and Restated Certificate of Incorporation, as amended,
of the Company as in effect immediately prior to the Effective Time shall be
amended so as to read in its entirety in the form attached hereto as Exhibit
B, and as so amended shall be the Restated Certificate of Incorporation of
the Surviving Corporation until further amended in accordance with the terms
thereof and the DGCL, and (e) the Company shall take all requisite actions so
that the By-laws of Merger Subsidiary, as in effect immediately prior to the
Effective Time, shall be the By-laws of the Surviving Corporation until further
amended in accordance with the terms thereof and the DGCL.  The Surviving Corporation shall possess all
the rights, privileges, immunities, powers and franchises of the Company and
Merger Subsidiary, and the Surviving Corporation shall by operation of law
become liable for all of the debts, liabilities and duties of the Company and
Merger Subsidiary.  The purpose of the
Surviving Corporation shall be as set forth in Article 2 of the Certificate of
Incorporation of the Surviving Corporation. 
The Merger shall have the effects set forth in Sections 259 through 261
of the DGCL.


 


Section 2.2.            Effective Time of the Merger.  Upon the terms and subject to the conditions
set forth in this Agreement, prior to the Closing, Merger Subsidiary and the
Company shall prepare, execute, and on the Closing Date shall cause to be filed
with the Secretary of State of the State of Delaware, the Certificate of Merger
in such form as is required by the relevant provisions of the DGCL (the “Certificate of Merger”) and all other
filings or recordings required under the DGCL. 
The Merger shall become effective upon the filing of the Certificate of
Merger, executed in accordance with the relevant provisions of the DGCL, with
the Secretary of State of the State of Delaware or at such later time as is
established by the Parties and set forth in the Certificate of Merger (the “Effective Time”).


 


Section
2.3.            Officers. 
Immediately following the Effective Time the Board of Directors of the
Surviving Corporation shall take all requisite actions so that the officers of
Merger Subsidiary immediately prior to the Effective Time shall be, from and
after the Effective Time, the officers of the Surviving Corporation, each to
hold office in accordance with the Restated Certificate of Incorporation and
By-laws of the Surviving Corporation, until such officer’s successor is duly
elected or appointed and qualified or until his or her earlier death,
resignation or removal in accordance with the Restated Certificate of
Incorporation and the By-laws of the Surviving Corporation.


 


13

















 


Section
2.4.            Asset Purchase.  Immediately prior to the Effective Time the Company will sell,
assign, transfer, convey and deliver to Acquisition Subsidiary, free and clear
of all Liens (other than Permitted Liens), and Acquisition Subsidiary will
purchase, acquire and accept from the Company, certain assets of the Company
set forth on Schedule 2.4 (the “Purchased
Assets”).  The purchase price
for the Purchased Assets (the “Purchase Price”) shall be an amount equal to
$1,754,000 and shall be payable in immediately available same day funds at
Closing to an account designated by the Company at least two Business Days
prior to the Closing Date.


 


Section
2.5.            Closing. 
(a)  Unless this Agreement shall
have been terminated and the transactions contemplated hereby shall have been
abandoned pursuant to Article VIII, and subject to the satisfaction or waiver
(to the extent permitted by applicable law) of all of the conditions set forth
in Article VII, the closing of the Merger and the Asset Purchase (the “Closing”), shall take place at 10:00 a.m.
on a date to be specified by the Parties, which shall be no later than two
Business Days following the satisfaction or waiver (to the extent permitted by
applicable law) of all of the conditions set forth in Article VII other than
such conditions that by their nature are to be satisfied at the Closing, but
subject to the fulfillment or waiver (to the extent permitted by applicable
law) of those conditions (the “Closing Date”),
at the offices of Schulte Roth & Zabel LLP, 919 Third Avenue, New York, New
York 10022, unless another date, place or time is agreed to in writing by the
Parties.


 


(b)           Subject to fulfillment or waiver of
the conditions set forth in Article VII, at the Closing, Parent shall deliver
to the Company all of the following:


 


(i)            each Ancillary Agreement to which
Parent is a party duly executed on behalf of Parent;


 


(ii)           a certificate executed on behalf of
Parent by an officer thereof, dated as of the Closing Date, in form and
substance reasonably satisfactory to the Company certifying as to the
incumbency and signatures of the officers of Parent executing this Agreement
and any Ancillary Agreement;


 


(iii)          a certificate of good standing of
Parent, issued as of a recent date by the Secretary of State of the State of
Delaware; and


 


(iv)          the certificate contemplated by
Section 7.3(a).


 


(c)           Subject to fulfillment or waiver of
the conditions set forth in Article VII, at the Closing, each of Merger
Subsidiary and Acquisition Subsidiary shall deliver to the Company all of the
following:


 


(i)            each Ancillary Agreement to which
Merger Subsidiary or Acquisition Subsidiary is a party duly executed on behalf
of Merger Subsidiary or Acquisition Subsidiary, as the case may be;


 


(ii)           a copy of the Certificate of
Incorporation of each of Merger Subsidiary and Acquisition Subsidiary with all
amendments thereto certified as of a recent date by the Secretary of State of
the State of Delaware;


 


14

















 


(iii)          a certificate of good standing of each
of Merger Subsidiary and Acquisition Subsidiary, issued as of a recent date by
the Secretary of State of the State of Delaware;


 


(iv)          a certificate of the Secretary or an
Assistant Secretary of each of Merger Subsidiary and Acquisition Subsidiary,
dated as of the Closing Date, in form and substance reasonably satisfactory to
the Company, certifying as to (A) the Certificate of Incorporation and the
Bylaws of Merger Subsidiary or Acquisition Subsidiary, as the case may be, and
(B) the incumbency and signatures of the officers of Merger Subsidiary or
Acquisition Subsidiary, as the case may be, executing this Agreement and the
Ancillary Agreements to which it is a party; and


 


(v)           the certificate contemplated by
Section 7.3(a).


 


(d)           Subject to fulfillment or waiver of
the conditions set forth in Article VII, at the Closing, the Company shall
deliver to Parent and Merger Subsidiary all of the following:


 


(i)            each Ancillary Agreement to which
the Company is a party duly executed on behalf of the Company;


 


(ii)           a bill of sale, duly executed on
behalf of the Company, in the form attached hereto as Exhibit C, and
short form assignments of trademarks in the form attached hereto as Exhibit
C-1 (collectively, the “Asset Purchase
Documents”);


 


(iii)          a copy of the Amended and Restated
Certificate of Incorporation of the Company with all amendments thereto,
certified as of a recent date by the Secretary of State of the State of
Delaware;


 


(iv)          a certificate of good standing of the
Company, issued as of a recent date by the Secretary of State of the State of
Delaware;


 


(v)           a certificate of the Secretary or an
Assistant Secretary of the Company, dated as of the Closing Date, in form and
substance reasonably satisfactory to Parent certifying as to (A) the Company’s
Amended Restated Certificate of Incorporation, as amended, and Bylaws, and (C)
the incumbency and signatures of the officers of the Company executing this
Agreement and the Ancillary Agreements;


 


(vi)          all consents, waivers or approvals
obtained by the Company described in Section 7.2(e) of the Company Disclosure
Letter; and


 


(vii)         the certificates contemplated by
Section 7.2(a);


 


(viii)        a certificate executed on behalf of the
Company’s transfer agent certifying as to the number of issued and outstanding
shares of Company Common Stock.


 


15

















 


ARTICLE III


 


CONVERSION OF SECURITIES


 


Section
3.1.            Conversion of Capital Stock.  As of the Effective Time, by virtue of the
Merger and without any action on the part of any Party or the Company
Stockholders or Merger Subsidiary Stockholders:


 


(a)           Capital Stock of Merger Subsidiary.  Each issued and outstanding share of Merger
Subsidiary Common Stock shall be converted into and become one fully paid and
nonassessable share of common stock, par value $0.01 per share, of the
Surviving Corporation and shall be the only issued and outstanding capital
stock of the Surviving Corporation. 
From and after the Effective Time, each outstanding certificate
theretofore representing shares of Merger Subsidiary Common Stock shall be
deemed for all purposes to evidence ownership and to represent the same number
of shares of common stock of the Surviving Corporation.


 


(b)           Cancellation of Treasury Stock and
Subsidiary-Owned Stock.  All Company
Common Stock that is owned by the Company or by any of its Subsidiaries or held
in the Company’s treasury immediately prior to the Effective Time shall be
cancelled and shall cease to exist and no consideration shall be delivered in
exchange therefor.


 


(c)           Exchange of Company Common Stock.  Each issued and outstanding share of Company
Common Stock (other than (i) shares of Company Common Stock to be cancelled in
accordance with Section 3.1(b) and (ii) any Appraisal Shares ) shall be
converted into the right to receive an amount in cash equal to $1.30 per share
of Company Common Stock (the “Cash Merger
Consideration”), payable to the holder thereof.  Such Cash Merger Consideration shall be paid
upon surrender of the certificate formerly representing such share of Company
Common Stock pursuant to Section 3.2. 
The shares of Company Common Stock converted into the right to receive
the Cash Merger Consideration are hereinafter referred to collectively as the “Cash Merger Shares”.  All such Cash Merger Shares, from and after
the Effective Time, shall no longer be outstanding and shall automatically be
cancelled and retired and shall cease to exist, and each holder of a
certificate formerly representing any Cash Merger Shares shall cease to have
any rights with respect thereto, except the right to receive the Cash Merger
Consideration therefor upon the surrender of such certificate in accordance
with Section 3.2, without interest.


 


Section
3.2.            Payment of Cash Merger
Consideration.


 


(a)           Paying Agent.  At least five Business Days prior to the
Effective Time, Parent shall designate the Paying Agent.  Immediately after the Effective Time, Parent
shall deposit the Payment Fund in trust with the Paying Agent.  The Payment Fund shall be invested by the
Paying Agent as directed by Parent.  The
Paying Agent shall, pursuant to irrevocable instructions, make the payments
referred to in Section 3.1(c) and this Section 3.2 out of the Payment
Fund.  The Payment Fund shall not be
used for any other purpose except as otherwise agreed to by Parent.  If the Payment Fund is insufficient to pay
all of the amounts required to be paid pursuant to Section 3.1(c) and this
Section 3.2, Parent from time to time after the Effective 


 


16

















 


Time shall promptly
deposit in trust additional cash with the Paying Agent sufficient to make all
such payments, or shall cause the Surviving Corporation to do so.


 


(b)           Exchange Procedures.


 


(i)            Within two Business Days following
the Effective Time, Parent shall cause the Paying Agent to mail to each holder
of record of a certificate or certificates that immediately prior to the
Effective Time represented outstanding Cash Merger Shares (collectively, the “Certificates”), whose shares of Company
Common Stock were converted pursuant to Section 3.1(c) into the right to
receive the Cash Merger Consideration, (A) a letter of transmittal (which shall
specify that delivery shall be effected, and risk of loss and title to the
Certificates shall pass, only upon actual delivery of the Certificates to the
Paying Agent, and shall otherwise be in customary form), and (B) instructions
for use in effecting the surrender of the Certificates in exchange for payment
of the Cash Merger Consideration.


 


(ii)           Upon surrender of a Certificate for
cancellation to the Paying Agent or to such other agent or agents as may be
appointed by the Surviving Corporation, together with such letter of
transmittal, duly executed and completed in accordance with the instructions
thereon, together with any other items specified by the letter of transmittal
or otherwise reasonably required by the Paying Agent, the holder of such
Certificate shall be entitled to receive in exchange therefor the Cash Merger
Consideration for each Cash Merger Share represented by such Certificate, and
the Certificate so surrendered shall forthwith be cancelled.  Until so surrendered, each Certificate shall
be deemed, for all purposes, to evidence only the right to receive upon such
surrender the Cash Merger Consideration deliverable in respect thereof to which
the holder thereof is entitled pursuant to Section 3.1(c) and this Section
3.2.  No interest will be paid or will
accrue in respect of any cash payable upon the surrender of any Certificate.


 


(iii)          If any Certificate shall have been
lost, stolen or destroyed, then, upon the making of an affidavit of that fact
by the Person claiming such Certificate to be lost, stolen or destroyed, Parent
shall cause the Paying Agent to pay in exchange for such lost, stolen or
destroyed Certificate the Cash Merger Consideration deliverable in respect
thereof to which the holder thereof is entitled pursuant to Section 3.1(c) and
this Section 3.2; provided, that Parent may require the Person to whom
any such Cash Merger Consideration is paid, as a condition precedent to the
payment thereof, to give the Surviving Corporation a bond in such sum as it may
direct or otherwise indemnify the Surviving Corporation in a manner reasonably
satisfactory to Parent against any claim that may be made against the Surviving
Corporation with respect to the Certificate claimed to have been lost, stolen
or destroyed.


 


(iv)          If payment of Cash Merger
Consideration is to be made to a Person other than the Person in whose name the
surrendered Certificate is registered, it shall be a condition of payment that
the Certificate so surrendered be properly endorsed or be otherwise in proper
form for transfer and that the Person requesting such payment shall have paid
any transfer and other taxes required by reason of the payment of Cash Merger
Consideration to a Person other than the registered holder of the Certificate
surrendered or shall have established to the satisfaction of the Surviving
Corporation that such tax either has been paid or is not applicable.  Each of the Paying Agent, Parent and the
Surviving Corporation shall be entitled to deduct and 


 


17

















 


withhold, or
cause to be deducted and withheld, from any consideration payable or otherwise
deliverable pursuant to this Agreement to any holder or former holder of Cash
Merger Shares such amounts as may be required to be deducted and withheld
therefrom under the Code or any provision of state, local or foreign Tax law or
under any other applicable legal requirement. 
To the extent such amounts are so deducted or withheld, such amounts
shall be treated for all purposes under this Agreement as having been paid to
the Person to whom such amounts would otherwise have been paid and shall be
paid to the appropriate Governmental Entity on behalf of such Person.


 


(v)           The Surviving Corporation shall pay
all charges and expenses of the Paying Agent in connection with the exchange of
the Cash Merger Consideration for the Cash Merger Shares.


 


(c)           No Further Transfer or Ownership
Rights in the Shares of Common Stock. 
From and after the Effective Time, the stock transfer books of the
Company shall be closed with respect to Company Common Stock and there shall be
no further registration of transfers of the Company Common Stock on the records
of the Surviving Corporation or its transfer agent, and if any Certificates are
presented to the Surviving Corporation for transfer, they shall be cancelled
and exchanged as provided in this Article III, subject to applicable law in the
case of Appraisal Shares.  All Cash
Merger Consideration paid upon the surrender for exchange of Certificates in
accordance with the terms of this Article III shall be deemed to have been paid
in full satisfaction of all rights pertaining to the Company Common Stock
exchanged for Cash Merger Consideration theretofore represented by such
Certificates.


 


(d)           Termination of Fund; No Liability.  At any time following the date which is the
six month anniversary of the Effective Time, Parent shall be entitled to
require the Paying Agent to deliver to it any funds (including any and all
interest and other income received with respect thereto) that had been made
available to the Paying Agent and that have not been disbursed to holders of
Certificates, and thereafter, such holders shall be entitled to look solely to
Parent (subject to abandoned property, escheat or other similar Laws) with
respect to the Cash Merger Consideration payable upon due surrender of their
Certificates, without any interest thereon; provided, that such holders
shall have no greater rights against Parent than may be accorded to general
creditors of Parent under applicable Laws. 
Any portion of the Payment Fund remaining unclaimed as of a date which
is immediately prior to such time as such amounts would otherwise escheat to or
become property of any government entity shall, to the extent permitted by
applicable law, become the property of Parent free and clear of any claims or
interest of any Person previously entitled thereto.  Notwithstanding the foregoing, neither Parent nor the Paying
Agent shall be liable to any Person for any amounts delivered to a public
official pursuant to any applicable abandoned property, escheat or other
similar Laws.


 


Section
3.3.            Appraisal Rights.  Notwithstanding anything in this Agreement to the contrary,
Appraisal Shares shall not be converted into or represent the right to receive
Cash Merger Consideration in accordance with Sections 3.1(c) and 3.2, but
rather each of the Appraisal Shares shall represent only the right to receive
payment of the appraised value of such Appraisal Shares in accordance with the
DGCL; provided, however, that if any holder of Appraisal Shares
shall (i) fail to establish his entitlement to appraisal rights as provided in
the DGCL or (ii) otherwise shall waive, withdraw or lose the right to appraisal
under the DGCL, 


 


18

















 


then such
Appraisal Shares shall thereupon be deemed to have been converted as of the
Effective Time into, and to have become exchangeable solely for the right to
receive Cash Merger Consideration otherwise payable in accordance with Sections
3.1(c) and 3.2, without any interest thereon. 
The Company shall give Parent (a) prompt written notice of any demand
for appraisal received by the Company, the withdrawal of any such demand, and
any other notice or instrument delivered or served relating to Appraisal
pursuant to the DGCL and (b) the opportunity to direct all negotiations and
proceedings with respect to any demand for appraisal under the DGCL.  The Company shall not, except with the prior
written consent of Parent, (i) make any payment with respect to any demand for
appraisal, (ii) offer to settle or settle any such demand for appraisal, (iii)
waive any failure to timely deliver a written demand for appraisal in
accordance with the DGCL, or (iv) agree to do any of the foregoing.


 


Section
3.4.            Stock Options and Restricted Stock.  The Company shall take such action as shall
be required so that (i) immediately prior to the Effective Time, each outstanding
Option shall become immediately vested and exercisable in full, (ii) with
respect to any Options that remain outstanding and unexercised as of the
Effective Time, all such Options (whether or not then vested or exercisable and
without regard to the exercise price, if applicable, of such Options) granted
under any Stock Plan or otherwise, shall be cancelled as of the Effective Time,
and, pursuant to the Stock Plans, all such outstanding Options (whether or not
vested or exercisable) shall represent solely the right to receive, in
accordance with this Section 3.4, a cash payment in the amount of the Option
Consideration (as defined below), if any, with respect to any such Option and
shall no longer represent or represent the right to purchase Company Common
Stock or any other equity securities of the Company, Parent, the Surviving
Corporation or any other Person or any other consideration, and (iii) as of the
Effective Time, the Stock Plans shall be terminated.  The forgoing actions shall take effect immediately prior to the
Effective Time.  Each holder of an
option to purchase Company Common Stock shall receive from Parent, in respect
and in consideration of each Option so cancelled, as soon as practicable following
the Effective Time (but in any event not later than five Business Days), an
amount (net of applicable taxes) equal to the excess, if any, of the Cash
Merger Consideration over the exercise price of such Option, multiplied by the
total number of shares of Common Stock subject to such Option, without any
interest thereon (the “Option Consideration”).  In the event that the exercise price of such
option is equal to or greater than the Cash Merger Consideration, such option
shall be cancelled and have no further force or effect.  As soon as practicable following the
execution of this Agreement, the Company shall mail to each person who is a
holder of any such Options a letter describing the treatment of and payments
for such Options pursuant to this Section 3.4 and providing instructions for
use in obtaining payment for such Options. 
The Company shall take all steps to ensure that neither it nor any of
its Subsidiaries or Affiliates shall be bound by any Options, other options,
warrants, rights or agreements which would entitle any Person, other than
Parent or its Affiliates, to own any capital stock or equity of the Company of
the Surviving Corporation or any of their Subsidiaries or to receive any
payment in respect thereof, except as expressly contemplated by this Section
3.4.


 


Section
3.5.            Employee Stock Purchase Plan.  The Company shall take all necessary action
under the Company’s Employee Stock Purchase Plan (the “Purchase Plan”) to provide that on the
earlier of the close of business on June 30, 2003 or the Effective Time (the “Purchase Plan Termination Date”), (i) all
participants’ rights under the ongoing Offering (as defined in the Purchase
Plan) shall terminate, (ii) all accumulated payroll deductions allocated to 


 


19

















 


each
participant’s account under the Purchase Plan shall thereupon be used to
purchase from the Company whole Common Shares at a price determined under the
terms of the Purchase Plan for the Offering using the Purchase Plan Termination
Date as the final Exercise Date (as defined in the Purchase Plan), and (iii)
the Purchase Plan will terminate.  At
the Effective Time, any Common Shares so purchased will be treated as provided
in Section 3.1 of this Agreement.


 


Section
3.6.            Further Assurances.  If at any time after the Effective Time the
Surviving Corporation shall consider or be advised that any agreements,
documents, deeds, bills of sale, assignments or assurances or any other acts or
things are necessary, desirable or proper (a) to vest, perfect or confirm, of
record or otherwise, in the Surviving Corporation, its right, title or interest
in, to or under any of the rights, privileges, powers, franchises, properties
or assets of either of the constituent corporations in the Merger, or (b)
otherwise to carry out the purposes of this Agreement, the Surviving
Corporation and its proper officers and directors or their designees are hereby
authorized to execute and deliver, in the name and on behalf of either of the
constituent corporations in the Merger, all such deeds, bills of sale,
assignments and assurances and do, in the name and on behalf of such
constituent corporations, all such other acts and things necessary, desirable
or proper, consistent with the terms of this Agreement, to vest, perfect or
confirm its right, title or interest in, to or under any of the rights,
privileges, powers, franchises, properties or assets of such constituent
corporations and otherwise to carry out the purposes of this Agreement.


 


ARTICLE IV


 


REPRESENTATIONS AND WARRANTIES OF THE COMPANY


 


The Company
has delivered to Parent a Disclosure Letter, dated the date hereof (the “Company Disclosure Letter”), receipt of
which has been acknowledged in writing thereon by Parent.  The Company Disclosure Letter shall be
arranged in sections and subsections corresponding to the sections and
subsections of this Article IV, but all of the disclosures are intended to
modify all of the Company’s representations and warranties only to the extent
that it is reasonably apparent from a reading of such disclosure that it also
qualifies or applies to such other representation or warranty.  The Company hereby represents and warrants
to Parent and Merger Subsidiary, except as expressly set forth in the
corresponding sections and subsections of the Company Disclosure Letter, as
follows:


 


Section
4.1.            Organization.  The Company and each of its Subsidiaries is an entity duly
organized, validly existing and in corporate good standing under the Laws of
its jurisdiction of organization and has all requisite power and authority to
own, lease and operate its properties and assets and to carry on its business
as now being conducted and as contemplated. 
The Company and each of its Subsidiaries is duly qualified or licensed
to do business, and is in corporate good standing as a foreign entity, in each
jurisdiction where the character of its properties or assets owned, operated
and leased or the nature of its activities makes such qualification necessary,
except where the failure to be so qualified or licensed or in good standing has
not resulted in and would not reasonably be likely to result in, individually
or in the aggregate, a Company Material Adverse Effect.  The Company has, prior to the date of this
Agreement, delivered to Parent true, complete and correct copies of the Amended
and Restated Certificate of Incorporation, as amended, and the By-laws of the
Company and the comparable 


 


20

















 


governing
documents of each of the Company’s Subsidiaries, in each case as amended and in
full force and effect as of the date of this Agreement.  The respective certificates of incorporation
and by-laws or other organizational documents of such Subsidiaries do not
contain any provision limiting or otherwise restricting the ability of the
Company to control such Subsidiaries.


 


Section
4.2.            Capitalization.  (a) The authorized capital stock of the Company consists of (x)
50,000,000 shares of Company Common Stock and (y) 10,000,000 shares of
preferred stock, par value $0.001 per share (“Preferred
Stock”).  As of the close of
business on the date hereof, (i)  with
respect to Company Common Stock, 15,600,035 shares of Company Common Stock are
issued and outstanding, no shares of Company Common Stock are issued and held
in the treasury of the Company and 3,677,117 shares of Company Common Stock are
reserved for issuance upon exercise of outstanding Options to purchase Company
Common Stock, and (ii) with respect to Preferred Stock, no shares are issued
and outstanding, or held in the treasury of the Company, and 500,000 shares are
designated Series A Junior Participating Preferred Stock and are reserved for
issuance in connection with the Company’s stockholder rights plan pursuant to
the Rights Agreement.  Section 4.2(a) of
the Company Disclosure Letter sets forth the exercise price, grant date,
expiration date for and number of shares subject to all outstanding options to
purchase Company Common Stock and the vesting date and grant date for all
shares of Restricted Stock.  All
outstanding shares of capital stock or other equity interests, as the case may
be, of the Company and each of the Subsidiaries are duly authorized, validly
issued, fully paid and non-assessable, and are not subject to and were not
issued in violation of any preemptive rights, purchase option, call option,
right of first refusal, subscription right or any similar right, and were
issued in compliance with applicable federal and state securities laws and
regulations.  All shares of capital
stock of the Company subject to issuance on the terms and conditions set forth
in the instruments pursuant to which they are issuable, will, when issued in
accordance with the terms of such instruments, be duly authorized, validly
issued, fully paid and non-assessable, and will not be subject upon issuance
to, nor issued in violation of, any preemptive rights, purchase option, call
option, right of first refusal, subscription right or any similar right, and
will be issued in compliance with applicable federal and state securities laws
and regulations.  Except as set forth
above and in Section 4.2(d) of the Company Disclosure Letter, (A) there are no
shares of capital stock or other equity securities (voting or nonvoting) of the
Company or any of its Subsidiaries authorized, issued or outstanding, (B) there
are no outstanding or authorized options or restricted stock (other than the
Options to purchase Company Common Stock and Restricted Stock described in
Section 4.2(a) of the Company Disclosure Letter) or warrants, calls, preemptive
rights, subscriptions or other similar rights, convertible or exchangeable
securities, “phantom” stock rights, stock appreciation rights, limited stock
appreciation rights, stock-based performance units, agreements, arrangements,
commitments or claims of any character, contingent or otherwise, (1) relating
to the issued or unissued capital stock of the Company or any of its
Subsidiaries or (2) obligating the Company or any of its Subsidiaries to issue,
transfer or sell or cause to be issued, transferred or sold any shares of capital
stock or other equity interests in the Company or any of its Subsidiaries or
securities convertible into or exchangeable for such shares or equity
interests, or obligating the Company or any of its Subsidiaries to grant,
extend or enter into any such option, restricted stock, warrant, call,
preemptive right, subscription or other right, convertible or exchangeable
security, agreement, arrangement, commitment or claim, and (C) neither the
Company nor any of its Subsidiaries has authorized or outstanding Voting Debt.


 


21

















 


(b)           Section 4.2 of the Company Disclosure
Letter sets forth a complete and accurate list of the Subsidiaries of the
Company.  Except for the Company’s
interest in its Subsidiaries and investments in marketable securities and
mutual funds, neither the Company nor any of its Subsidiaries owns directly or
indirectly any interest or investment (whether equity or debt securities) in,
nor is the Company or any of the Subsidiaries subject to any obligation or
requirement to provide for or to make any investment (whether equity or debt
securities) to or in, any Person.


 


(c)           Except as set forth in Section 4.2(c)
of the Company Disclosure Letter, all of the outstanding shares of capital
stock or other equity interests of each of the Company’s Subsidiaries are
owned, of record and beneficially, by the Company, or directly or indirectly
beneficially, by either the Company or one or more of its Subsidiaries, in each
case free and clear of all Liens.  No
shares of capital stock of, or ownership interests in, any of the Company’s
Subsidiaries are reserved for issuance.


 


(d)           Other than the Voting Agreement and
the Rights Agreement, there are no voting trusts, proxies, registration rights
agreements, or other agreements, commitments, arrangements or understandings of
any character by which the Company or any of its Subsidiaries is bound with
respect to the voting of any shares of capital stock or other equity interests
of the Company or any of its Subsidiaries or with respect to the registration
of the offering, sale or delivery of any shares of capital stock or other
equity interests of the Company or any of its Subsidiaries under the Securities
Act.


 


(e)           None of the Company or its
Subsidiaries are required to redeem, repurchase or otherwise acquire shares of
capital stock or other equity interests of the Company or any of its
Subsidiaries.


 


(f)            Except as set forth in Section
4.2(f) of the Company Disclosure Letter, there are no restrictions of any kind
which prevent or restrict the payment of dividends by the Company or any of its
Subsidiaries other than those imposed by the corporate laws of general
applicability of their respective jurisdictions of organization.


 


Section
4.3.            Authorization; Validity of
Agreement; Company Action. 
The Company has full corporate power and authority to execute and
deliver this Agreement, the Asset Purchase Documents, the Voting Agreement and
each instrument required hereby to be executed and delivered by the Company
prior to or at the Effective Time, and, subject to obtaining Company
Stockholder approval thereof to the extent required by the DGCL and the
Company’s Amended and Restated Certificate of Incorporation, as amended, to
perform its obligations hereunder and thereunder and to consummate the
Transactions.  The execution, delivery
and performance by the Company of this Agreement, the Voting Agreement and each
instrument required hereby to be executed and delivered by the Company prior to
or at the Effective Time and the performance of its obligations hereunder and
thereunder and the consummation by it of the Transactions have been duly
authorized by its Board of Directors, and, except for obtaining the approval of
the Company Stockholders as contemplated by Section 6.5, no other corporate
action on the part of the Company is necessary to authorize the execution,
delivery and performance by the Company of this Agreement, the Voting Agreement
and the consummation by it of the Transactions.  This Agreement, the Voting Agreement and each 


 


22

















 


instrument
required hereby to be executed and delivered by the Company prior to the
Effective Time have been duly executed and delivered by the Company and,
assuming due and valid authorization, execution and delivery thereof by Parent
and Merger Subsidiary and any other parties thereto, is each a valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms.


 


Section
4.4.            Consents and Approvals; No Violations.  The execution and delivery of this Agreement
and the Ancillary Agreements by the Company does not, and the consummation by
the Company of the Transactions and the compliance by the Company with the
applicable provisions of this Agreement and the Ancillary Agreements will not:


 


(a)           assuming the stockholder approval
described in Section 4.23 is obtained, violate or conflict with or result in
any breach of any provision of the Amended and Restated Certificate of
Incorporation, as amended, or the By-laws of the Company or the comparable
governing documents of any of its Subsidiaries;


 


(b)           require any Governmental Approval,
except for (i) the filing with the SEC of (A) the Proxy Statement, and (B) such
reports, schedules or materials under the Exchange Act as may be required in
connection with this Agreement and the transactions contemplated by this
Agreement; (ii) the Governmental Approvals set forth in Section 4.4(b) of the
Company Disclosure Letter; (iii) the filing of the Certificate of Merger with the
Secretary of State of the State of Delaware, all other filings and recordings
required under the DGCL and appropriate documents with the relevant authorities
of other states and countries in which the Company and its Subsidiaries are
qualified to do business and (iv) Government Approvals which, if not obtained,
would not reasonably be expected to (x) result in a material loss or liability
to the Company or its Subsidiaries or (y) interfere in a material manner with
the business or operations of the Company and its Subsidiaries or the ownership
of their properties or assets.


 


(c)           except as set forth in Section 4.4(c)
of the Company Disclosure Letter, result in a material violation or breach of,
conflict with, constitute (with or without due notice or lapse of time or both)
a material default under, give rise to any material penalty, right of
amendment, modification, renegotiation, termination, cancellation, payment or
acceleration or any right or obligation or loss of any material benefit or
right under, or result in the creation of any Liens upon any of the properties
or assets of the Company or any of its Subsidiaries under any of the terms,
conditions or provisions of any loan or credit agreement, note, bond, mortgage
or indenture, or under the terms, conditions or provisions of any Customer
Agreement, Material Contract, SEC Contract, lease for Leased Real Property,
license for Licensed Intellectual Property or material Company Permit; or


 


(d)           assuming that all Governmental
Approvals set forth in clause (b) have been obtained and all filings and
notifications described in clause (b) have been made, violate or conflict with
any Law applicable to the Company or any of the Subsidiaries or by which any of
their properties or assets may be bound except such violations or conflicts
that would not reasonably be expected to (x) result in a material loss or
liability to the Company or its Subsidiaries or (y) interfere in a material
manner with the business or operations of the Company and its Subsidiaries or
the ownership of their properties or assets.


 


23

















 


Section
4.5.            SEC Reports and Financial
Statements.  (a)  The Company has timely filed with the SEC
all Company SEC Documents, all of which are publicly available by EDGAR (other
than the certification required under section 906 of the Sarbanes-Oxley Act of
2002 which have been furnished as correspondence to the SEC, a true and
complete copy of which has been delivered to Parent).  Except to the extent amended or superseded by a subsequent filing
with the SEC made prior to the date hereof, as of their respective dates (and
if so amended or superseded, then on the date of such filing prior to the date
hereof), the Company SEC Documents (including any financial statements or
schedules included therein) and any forms, reports, schedules, statements,
registration statements, proxy statements and other documents (including in
each case, exhibits, schedules, amendments or supplements thereto, and any
other information incorporated by reference therein) (i) did not, and in the
case of Subsequent Filings will not, contain any untrue statement of a material
fact or omit, or in the case of Subsequent Filings will not omit, to state a
material fact required to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading and (ii) complied, and in the case of Subsequent Filings
will comply, in all material respects with the applicable requirements of the
Exchange Act and the Securities Act, as the case may be except as set forth in
Section 4.5(a) of the Company Disclosure Letter.  Notwithstanding the foregoing, the Company makes no
representation or warranty with respect to any information supplied by Parent
or Merger Subsidiary in writing relating to Parent, Merger Subsidiary or any
affiliate thereof (other than the Company or any of its Subsidiaries), as the
case may be, expressly for inclusion or incorporation by reference in the Proxy
Statement.  None of the Company’s
Subsidiaries is required to file any forms, reports or other documents with the
SEC.


 


(b)           Except as set forth in Section
4.5(b), each of the financial statements contained or to be contained in the
Company SEC Documents (including, in each case, any related notes and
schedules) has (i) been prepared from, and is in accordance with, the books and
records of the Company and its consolidated Subsidiaries, complies in all
material respects with applicable accounting requirements and with the
published rules and regulations of the SEC with respect thereto, (ii) been
prepared in accordance with GAAP (except as may be indicated in the notes
thereto and in the case of unaudited quarterly financial statements, as
permitted by Form 10-Q under the Exchange Act) and fairly presents the
consolidated financial position and the consolidated results of operations and
cash flows of the Company and its consolidated Subsidiaries at the dates and
for the periods covered thereby except that the unaudited interim financial
statements were or are subject to normal and recurring year-end adjustments.


 


Section
4.6.            No Undisclosed Liabilities.  The Company and its Subsidiaries do not have
any claims, liabilities, indebtedness or payment obligations of any nature
(whether known or unknown, accrued, absolute, contingent, asserted, liquidated
or otherwise), except (a) as disclosed in Section 4.6 of the Company Disclosure
Letter; (b) as reflected and reserved against on the December 31, 2002 balance
sheet or disclosed in the notes thereto included in the Company SEC Documents;
(c) to the extent specifically identified as a claim, liability, indebtedness
or payment obligation of the Company or its Subsidiaries of any nature in any
section of the Company Disclosure Letter; (d) such claims, liabilities,
indebtedness or payment obligations of any nature that would have been required
to be disclosed as such in any section of the Company Disclosure Letter but for
the existence of a materiality or Company Material 


 


24

















 


Adverse Effect qualification or
a specific dollar threshold limiting such disclosure or (e) that would not
individually or in the aggregate result in a Company Material Adverse Effect.


 


Section
4.7.            Absence of Certain Changes.  Since December 31, 2002, the Company has
conducted, and has caused its Subsidiaries to conduct, their respective
businesses only in the ordinary course of business consistent with past
practice.  Without limiting the
generality of the foregoing, except as disclosed in Section 4.7 of the Company
Disclosure Letter:


 


(a)           there has not occurred any event,
change, occurrence, effect, fact, violation, development or circumstance that
has resulted in or would reasonably be likely to result in, individually or in
the aggregate, a Company Material Adverse Effect;


 


(b)           there has been no declaration,
setting aside or payment by the Company or any Subsidiary of any dividend or
other distribution payable in cash, securities or other property with respect
to, or split, combination, redemption, reclassification, purchase or other
acquisition of, any shares of capital stock (or other equity interests) or
other securities of the Company or any of its Subsidiaries, other than those
payable by a wholly-owned Subsidiary of the Company solely to the Company or to
another wholly-owned Subsidiary of the Company, or any other change in the
capital structure of the Company or any of its Subsidiaries;


 


(c)           other than issuances of Common Stock
pursuant to the exercise of Options outstanding prior to the date of this
Agreement, there has been no issuance or sale, or authorization therefor, by
the Company or any Subsidiary of any shares of capital stock or any other
securities (equity or debt) of the Company or any of its Subsidiaries or
issuance, sale or authorization by the Company or any Subsidiary for any
securities (equity or debt) convertible into or exchangeable for, or options,
warrants, calls, commitments or rights of any kind to purchase or subscribe
for, or the entering into by the Company or any Subsidiary of any arrangement
or contract with respect to the issuance or sale of, any shares of capital
stock of any class of the Company or Voting Debt or other securities (equity or
debt), or any other changes to the capital structure of the Company or any of
its Subsidiaries;


 


(d)           there have been no Contracts (or
amendments, modifications, supplements or replacements to existing Contracts)
made or committed to be made or entered into to be performed by the Company or
any of its Subsidiaries relating to, and none of them have made any, capital
expenditures by the Company or any of its Subsidiaries with a value in excess
of $20,000 in the current year or any future calendar year, or in the aggregate
for such capital expenditures with a value in excess of $200,000;


 


(e)           neither the Company nor any of its
Subsidiaries has acquired, by merging or consolidating with, by purchasing an
equity interest in, by purchasing all or a portion of the assets of, or by any
other manner, any business or any Person, or other acquisition of any assets of
any Person (other than the purchase of equipment, inventories and supplies in
the ordinary course of business consistent with past practice);


 


(f)            there have been no transfers,
leases, licenses, guarantees, sales, mortgages, pledges, disposals of,
subjecting to Liens (other than Permitted Liens) or other encumbrances on, any
assets of the Company or any of its Subsidiaries that are material to their
business or that 


 


25

















 


have a value
individually in excess of $50,000 other than with respect to (i) transactions
between wholly-owned Subsidiaries of the Company and the Company or between
wholly-owned Subsidiaries of the Company, (ii) dispositions of excess or
obsolete assets of the Company or any of its Subsidiaries in the ordinary
course of business consistent with past practice and (iii) leases, licenses or
sales in the ordinary course of business consistent with past practice;


 


(g)           except to the extent required under
existing employee and director benefit plans, agreements or arrangements in
effect on December 31, 2002, as set forth in Section 4.2 of the Company
Disclosure Schedule or required by applicable law or contemplated by Section
3.4, and other than the grant of awards in the ordinary course of business
pursuant to the Company’s stock option plans or the Purchase Plan prior to the
date of this Agreement and set forth in Section 4.2(a) of the Company
Disclosure Schedule, there have been no increases in the compensation or fringe
benefits of any of the Company’s or its Subsidiaries’ directors, officers or
employees (except for immaterial increases to employees who are not officers of
the Company or any of its Subsidiaries in the ordinary course of business
consistent with past practice), no grants of any severance or termination pay
not required to be paid under then existing severance plans, no employment,
benefit (including with respect to life or disability insurance or with respect
to premiums therefor), consulting or severance agreements, policies or
arrangements with any present or former directors, officers or other employees
of the Company or any of the Company’s Subsidiaries, no establishment or
adoption of or amendments, modifications, supplements, replacements or
terminations of any collective bargaining, bonus, profit sharing, thrift,
compensation, stock option, restricted stock, benefit (including with respect
to life or disability insurance or with respect to premiums therefor), pension,
retirement, deferred compensation, employment, termination, severance or other
plans, agreements, trusts, funds, policies or arrangements for the collective
benefit of any directors, officers or employees;


 


(h)           there have been no plans of complete
or partial liquidation, dissolution, merger, consolidation, restructuring,
recapitalization or other reorganizations of the Company or any of its
Subsidiaries or any agreements relating to any Acquisition Proposals adopted or
entered into;


 


(i)            there has been no (i) incurrence,
assumption, modification or prepayment of any indebtedness for borrowed money,
issuance of any debt securities or warrants or other rights for the acquisition
of debt securities, or guarantees, endorsements or liabilities or responsibilities
for the obligations or indebtedness of another Person by the Company or any of
its Subsidiaries, other than indebtedness owing to or guarantees of
indebtedness owing to, the Company or any direct or indirect wholly-owned
Subsidiary of the Company, or capital leases entered into, or (ii) loans,
extensions of credit or advances by the Company or any of its Subsidiaries to
any other Person, other than to the Company or to any direct or indirect
wholly-owned Subsidiary of the Company, except, in the case of preceding
clauses (i) and (ii), for loans, extensions of credit or advances constituting
trade payables or receivables arising in the ordinary course of business and in
the case of preceding clause (ii), for advances to employees in respect of travel
and entertainment expenses in the ordinary course of business in amounts of
$10,000 or less to any individual on any date of determination and $50,000 in
the aggregate outstanding on any date of determination;


 


26

















 


(j)            there have been no accelerations of
the payment, right to payment or vesting of any bonus, severance, profit
sharing, retirement, deferred compensation, stock option, restricted stock,
insurance (including arrangements or agreements for premiums therefor) or other
compensation or benefits of the Company or any of its Subsidiaries;


 


(k)           neither the Company nor any of its
Subsidiaries has made any payments, discharges, settlements or satisfactions of
any claims, litigation, liabilities or obligations (absolute, accrued, asserted
or unasserted, contingent or otherwise) other than (i) the payment, discharge,
settlement or satisfaction, in the ordinary course of business consistent with
past practice, of (A) liabilities reflected or reserved against in the December
31, 2002 balance sheet included in the Company SEC Documents or (B) liabilities
(other than litigation) subsequently incurred in the ordinary course of
business consistent with past practice and (ii) other claims, litigation,
liabilities or obligations (qualified as aforesaid) that in the aggregate do
not exceed $100,000;


 


(l)            there have been no plans,
announcements, implementations or effectuations of any reductions in force,
lay-offs, early retirement programs, severance programs or other programs or
efforts concerning the termination of employment of employees of the Company or
its Subsidiaries, other than routine employee terminations in the ordinary
course of business and consistent with past practice;


 


(m)          there have been no actions or
omissions which (i) constitute a violation of any material Company Permit,
which violations would result in or would reasonably be likely to result in,
individually or in the aggregate, the modification, suspension, cancellation,
termination of any one or more material Company Permit or otherwise have or
would reasonably be likely to have a material adverse impact on any customer or
client contract or relationship or the nature or level of discipline imposed on
account of future violations of the Laws applicable to the Company and the
Surviving Corporation or (ii) would (or would reasonably be likely to)
materially impede, delay, hinder or make more burdensome for the Surviving
Corporation or Parent to obtain and maintain any and all authorizations, approvals,
consents or orders from any Governmental Entity or other third party necessary
or required to maintain the Company Permits in effect at all times following
the Merger on the same terms as in effect on the date of this Agreement;


 


(n)           there have been no entries into any
new material lines of business;


 


(o)           there has been no failure to maintain
with current or other financially responsible insurance companies insurance on
the Company’s or its Subsidiaries’ assets, tangible and intangible, and their
respective businesses in such amounts and against such risks and losses as are
consistent with past practice and standard practice in the Company’s industry;


 


(p)           there has been (i) no materially
amended Tax Returns or claims for refund filed, (ii) no making or rescission of
any material Tax election or other failure to prepare all Tax Returns in a
manner which is consistent with the past practices of the Company and each
Subsidiary of the Company, as the case may be, with respect to the treatment of
items on such Tax Returns except to the extent that any inconsistency (A) did
not, would not, or may not materially increase Parent’s, the Company’s or any
of the Company’s Subsidiaries’ liability for 


 


27

















 


Taxes for any
period or (B) is or was required by Law, (iii) no incurrence of any material
liability for Taxes other than in the ordinary course of business, apart from
any Tax liability that may result from the Asset Purchase, or (iv) no
settlement or closing agreement with a taxing authority that materially
increases or would reasonably be likely to materially increase the Tax
liability of the Company or any of its Subsidiaries for any period entered
into; and


 


(q)           there has been no material change by
the Company or any of its Subsidiaries in any accounting practices, policies or
procedures or any methods of reporting income, deductions or other items for
income tax purposes (except insofar as may have been required by applicable
law, GAAP or SEC rule or which are, or will be in the event of a requirement of
law, GAAP or SEC rule adopted after the date hereof, disclosed in the Company
SEC Documents and described in Section 4.7(g) of the Company Disclosure
Schedule).


 


Section
4.8.            Taxes.  (a) Tax
Returns.  Each of the Company and
its Subsidiaries has timely filed or caused to be timely filed with the
appropriate taxing authorities all material Tax Returns that are required to be
filed by, or with respect to, each of the Company and its Subsidiaries.


 


(b)           Payment of Taxes.  As of the date of the most recently filed
Company SEC Documents, any unpaid material Taxes of the Company and its
Subsidiaries imposed with respect to the income, assets or operations of the
Company and its Subsidiaries have been accrued and adequately disclosed and
provided for in such Company SEC Documents in accordance with GAAP.  Since the date of the most recently filed
Company SEC Documents, neither the Company nor any of its Subsidiaries has
incurred any material Tax liability outside the ordinary course of business,
other than any Tax liability that may be incurred as a result of the Asset
Purchase.


 


(c)           Other Tax Matters.


 


(1)           Except as set forth in Section 4.8(c)(1) of the Company
Disclosure Letter, (i)  neither the
Company nor any of its Subsidiaries is currently the subject of an audit or
other examination of Taxes by the tax authorities of any nation, state or
locality, (ii) no such audit or other examination is pending, or to the
Company’s Knowledge, threatened and (iii) neither the Company nor any of its
Subsidiaries has received any written notice from any taxing authority relating
to any issue which could have a material adverse effect on the Tax liability of
the Company or any of its Subsidiaries.


 


(2)           Neither the Company nor any of its Subsidiaries (i) has
entered into an agreement or waiver that will be in effect as of the Closing
Date or been requested to enter into an agreement or waiver extending any
statute of limitations relating to the payment or collection of Taxes of the Company
or any of its Subsidiaries, or (ii) is presently contesting the Tax liability
of the Company or any of its Subsidiaries in any administrative or judicial
proceeding.


 


(3)           Neither the Company nor any of its Subsidiaries has been
included in any affiliated group (within the meaning of Section 1504(a) of the
Code) or 


 


28

















 


any
consolidated, combined or unitary group (under state or local law) of which the
Company or any such Subsidiary is or has been a member (each, an “Affiliated Group”) with any Person (other
than the Company or any current Subsidiary thereof) for any taxable period for
which, to the Company’s Knowledge, the statute of limitations has not expired.


 


(4)           Except as set forth in Section 4.8(c)(4), all material Taxes
which the Company and each or any of its Subsidiaries is (or was) required by
law to withhold or collect in connection with amounts paid or owing to any
employee, independent contractor, creditor, stockholder or other third party
have been duly withheld or collected, and have been timely paid over to the
proper authorities to the extent due and payable.


 


(5)           No claim has been made in writing by any taxing authority in
a jurisdiction where the Company or any of its Subsidiaries does not file Tax
Returns that the Company or any of its Subsidiaries is or may be subject to
taxation by that jurisdiction.


 


(6)           There are no tax sharing, allocation, indemnification or
similar agreements in effect as between the Company or any of its Subsidiaries
or any predecessor or affiliate thereof (other than Parent and its affiliates)
and any other party under which Parent, Merger Subsidiary, the Company or any
of the Company’s Subsidiaries could be liable for any Taxes or other claims of,
or could otherwise have any liability or obligation to, any party after the
Closing Date.


 


(7)           Neither the Company nor any of its Subsidiaries has applied
for, been granted, or agreed to any accounting method change for which it will
be required to take into account any adjustment under Section 481 of the Code
or any similar provision of the Code or the corresponding tax laws of any
nation, state or locality.


 


(8)           No election under Section 341(f) of the Code has been made
or shall be made prior to the Closing Date to treat the Company or any of its
Subsidiaries as a consenting corporation, as defined in Section 341 of the
Code.


 


(9)           Neither the Company nor any of its Subsidiaries is a party
to any agreement that would require (including as a result of the execution and
delivery of this Agreement or the consummation of the Merger or any of the
other transactions contemplated by this Agreement) the Company or any of its
Subsidiaries or any affiliate thereof to make any payment that would constitute
an “excess parachute payment” for purposes of Sections 280G and 4999 of the
Code or that would not be deductible pursuant to Section 162(m) of the Code.


 


(10)         The Company and each of its Subsidiaries have delivered or
made available to Parent and Merger Subsidiary true, complete and correct
copies of each of the Tax Returns for income Taxes filed on behalf of the
Company and each of its Subsidiaries for the 1999, 2000 and 2001 tax years.


 


29

















 


Section
4.9.            Title to Properties; Owned and
Leased Real Properties; No Liens.  (a) The Company and each of its Subsidiaries has, in the case of
Leased Real Property and leased assets, valid leasehold interests in, (i) all
of its material tangible properties and assets (real and personal), including
all such properties and assets reflected in the Company’s consolidated balance
sheet as of December 31, 2002 contained in the Company SEC Documents, except as
indicated in the notes thereto or as sold or otherwise disposed of in the ordinary
course of business after such date, and (ii) all the material tangible
properties and assets that have been purchased by the Company or any of the
Subsidiaries since December 31, 2002, except for such properties and assets
that have been sold or otherwise disposed of in the ordinary course of
business, in each case subject to no Liens, except for Permitted Liens.


 


(b)           The Company has no Owned Real
Property.


 


(c)           Section 4.9(c)(i) of the Company
Disclosure Letter sets forth a complete and correct list of all Leased Real
Property.  The Company or one of its
Subsidiaries has a valid leasehold interest in all Leased Real Property, free
and clear of any and all Liens except for Permitted Liens.  Except as set forth in Section 4.9(c)(ii),
each lease with respect to the Leased Real Property is in full force and effect
in accordance with its terms in all material respects; in each case, the
Company or its Subsidiary, as applicable, has been in peaceable possession
since the commencement of the original term of such lease and is not in default
thereunder in any material respect, and, to the Knowledge of the Company, there
exists no default or event, occurrence, condition or act (including the
Transactions) which, with the giving of notice, the lapse of time or the
happening of any further event or condition (including the Transactions), would
become a default in any material respect under such lease.  Except as set forth in Section 4.9(c)(iii),
neither the Company nor any of its Subsidiaries has violated any of the terms
or conditions under any such lease in any material respect, and, to the
Company’s Knowledge, all of the covenants to be performed by any other party
under any such lease have been fully performed in all material respects.  The Company has, prior to the date of this
Agreement, made available to Parent true, complete and correct copies of each
lease or other agreement (including, in each case, any and all amendments,
modifications and supplements thereto) with respect to each Leased Real
Property as set forth in Section 4.9(c) of the Company Disclosure Letter.


 


(d)           All of the Company’s and its
Subsidiaries’ material personal property, including computers, electronics,
leasehold improvements, furnishings, machinery and equipment, is in good repair
(ordinary wear and tear excepted), has been well maintained, is in good working
order and, to the knowledge of the Company, materially complies with all
applicable Laws.


 


(e)           Except as set forth in Section 4.9(e)
of the Company Disclosure Letter, neither the Company nor any of its
Subsidiaries is contractually obligated to undertake or pay for the restoration
or removal of any alterations or improvements or the repair of any damages
(including any such damages arising from lapses of maintenance) with respect to
any Leased Real Property which is reasonably likely to cost in excess of
$100,000 in the aggregate except to the extent that such restoration, removal,
alteration, improvement or repair is specifically provided for on the Balance
Sheet.


 


30

















 


Section
4.10.          Intellectual Property.           (a) 
Section 4.10(a) of the Company Disclosure Letter sets forth a true and
complete list of all of the (i) Registered and material unregistered Owned
Intellectual Property and (ii) Licensed Intellectual Property (other than
Computer Software that is readily commercially available for $100,000 or less)
used by the Company, separated into the following categories:  (A) Licensed Intellectual Property that is
separate from the Products (i.e., an add-on Product) that is sold or licensed
(bundled) together with one or more products and (B) Licensed Intellectual
Property not licensed by the Company and its Subsidiaries to customers but used
internally by the Company or its Subsidiaries.


 


(b)           Except as set forth in Section
4.10(b) of the Company Disclosure Letter, to the Company’s Knowledge, all Owned
Intellectual Property is valid, subsisting and enforceable.  Except as set forth in Section 4.10(b) of the
Company Disclosure Letter, no Owned Intellectual Property (i) has been
adjudicated invalid or unenforceable, (ii) has been abandoned or cancelled
(excepting any expirations in the ordinary course), or (iii) is subject to any
outstanding order, judgment or decree restricting its use or adversely
affecting the Company’s or its Subsidiaries’ rights thereto.  To the Company’s Knowledge, no Licensed
Intellectual Property has been abandoned, cancelled or adjudicated invalid
(excepting any expirations in the ordinary course), or is subject to any outstanding
order, judgment or decree restricting its use or adversely affecting or
reflecting the Company’s or the Subsidiaries’ rights thereto.  The Company has taken commercially
reasonable steps to ensure that the Owned Intellectual Property has been marked
where appropriate with notices and legends as permitted by Federal and State
laws or otherwise permitted to indicate the Company’s or its Subsidiaries’
patent, trademark, copyright, confidential, proprietary, and other Intellectual
Property rights in such Owned Intellectual Property.


 


(c)           Except as set forth in Section
4.10(c) of the Company Disclosure Letter, the Company and its Subsidiaries own
or have the right to use all Intellectual Property currently used in their
business.  All rights in and to the
Owned Intellectual Property are free of all Liens and are fully assignable by
the Company and the Subsidiaries to any Person, without payment, consent of any
Person or other condition or restriction and, after giving effect to the Asset
Purchase, good and valid title to the Purchased Assets will vest in Acquisition
Subsidiary.  The Owned Intellectual
Property and Licensed Intellectual Property is sufficient to operate the
business of the Company as currently conducted.  Except as set forth in Section 4.10(c) of the Company Disclosure
Letter, no Person other than the Company has any ownership interest in, or a
right to receive a royalty or similar payment with respect to, any of the Owned
Intellectual Property.


 


(d)           Except as set forth in Section
4.10(d) of the Company Disclosure Letter, the Company has no Knowledge of any
(i) suit, action, reissue, reexamination, public protest, interference,
arbitration, mediation, opposition, cancellation or other proceeding
(collectively, “Suit”) that is pending alleging that the Company or the
Subsidiaries have violated any Intellectual Property rights of any Person, (ii)
claim that has been threatened or asserted against the Company or the
Subsidiaries or any of their indemnitees (as indemnities under a Customer Agreement)
alleging a violation of any Intellectual Property rights of any Person, (iii)
violation by the Company or the Subsidiaries of any Person’s Intellectual
Property rights, or (iv) information that would constitute a reasonable basis
for any of the foregoing.


 


31

















 


(e)           Except as set forth in Section
4.10(e) of the Company Disclosure Letter, no Suit is pending relating to any
Customer Agreement or Licensed Intellectual Property Agreement, including any
Suit alleging that the Company or the Subsidiaries or another person has
breached any Customer Agreement or Licensed Intellectual Property Agreement or
that any such agreement is invalid or unenforceable.  No such Suit has been threatened or asserted in writing and, to
the Knowledge of the Company, none has been threatened or asserted orally or
electronically.  To the Company’s
Knowledge (but without inquiry) there exists no event, condition or occurrence
which, with the giving of notice or lapse of time, or both, would constitute a
breach or default by the Company or the Subsidiaries or the other signatory
under any Customer Agreement or Licensed Intellectual Property Agreement.  No party to any Customer Agreement or
Licensed Intellectual Property Agreement has given the Company or the
Subsidiaries (i) notice of its intention to cancel or terminate any Customer
Agreement or Licensed Intellectual Property Agreement or (ii) written notice
that it will not renew any Customer Agreement or Licensed Intellectual Property
Agreement.


 


(f)            No Suit is pending concerning the
Owned Intellectual Property, including any Suit alleging that the Owned
Intellectual Property is invalid, unenforceable, unpatentable, unregisterable,
cancelable, not owned or not owned exclusively by the Company or its
Subsidiaries.  No such Suit has been
threatened or asserted in writing and, to the Knowledge of the Company, none
has been threatened or asserted orally or electronically.  To the Company’s Knowledge (but without
inquiry), no valid basis for any such Suits or claims exists.


 


(g)           Except as set forth in Section
4.10(g) of the Company Disclosure Letter, the Company has no Knowledge that any
Person is violating any Owned Intellectual Property or any material Licensed
Intellectual Property.


 


(h)           Except as set forth in Section
4.10(h) of the Company Disclosure Letter, the Company and the Subsidiaries have
timely made all filings, recordations, and payments with the appropriate
foreign and domestic agencies required to maintain in subsistence all Registered
Owned Intellectual Property and reflecting the Company or a Subsidiary as the
owner thereof.  Except as set forth in
Section 4.10(h) of the Company Disclosure Letter, no due dates for filings or
payments concerning the Registered Trademarks (including office action
responses, affidavits of use, affidavits of continuing use, renewals, requests
for extension of time, maintenance fees, application fees and foreign
convention priority filings) falling due within ninety (90) days of the Closing
Date, whether or not such due dates are extendable.


 


(i)            Except as set forth in a Customer
Agreement or other agreement with a customer of the Company, in each case with
respect to source code comprising the Company’s Products, the Company and the
Subsidiaries have taken all reasonable measures to protect the secrecy,
confidentiality and value of all Trade Secrets used in their businesses  (including entering into appropriate
confidentiality agreements with all officers, directors, employees, and other
Persons who are authorized to use Company Trade Secrets).  To the Company’s Knowledge except as set
forth in a Customer Agreement or other agreement with a customer of the
Company, in each case with respect to source code comprising the Company’s
Products, none of the Company Trade Secrets have been disclosed to any Person
unless such Person executed appropriate confidentiality agreements prohibiting
the unauthorized use or disclosure of such 


 


32

















 


Company Trade
Secrets and containing other terms as reasonably necessary or appropriate for
the protection and maintenance of such Company Trade Secrets.


 


(j)            To the Company’s Knowledge, no
current or former Company or Subsidiary employee is or was a party to any
confidentiality agreement and/or agreement not to compete that forbids or
forbade at any time during such employee’s employment by the Company or a
Subsidiary the activity that such employee was hired to perform or otherwise
performed on behalf of or in connection with such employee’s employment by the
Company or a Subsidiary.


 


Section
4.11.          Products. 
(a)        Except as set forth in
Section 4.11(a) of the Company Disclosure Letter, the Company is the sole and
exclusive owner of the Products and all constituent parts thereof (excluding
Licensed Intellectual Property).


 


(b)           Except as set forth in Section
4.11(b) of the Company Disclosure Letter, to the Company’s Knowledge, the
Products perform in all material respects in accordance with the Ancillary
Product Materials and applicable Customer Agreement.  No Disabling Devices were embedded in the Products by the Company
or any Subsidiary and, to the Company’s Knowledge, the Products do not contain
any Disabling Devices.


 


(c)           The source code for the Products will
compile into executable object code.  To
the Company’s Knowledge, the source code, Ancillary Product Materials and other
Documentation, to the extent pertaining to the Products are accurate and
sufficiently documented to enable a Computer Software developer of reasonable
skill to understand, modify, repair, maintain, compile and otherwise use the
material aspects of the Products.


 


(d)           Section 4.11(d) of the Company
Disclosure Letter contains (i) true and complete copies of the Company’s
current versions of its standard Customer Agreements, (ii) true and complete
list of the names of the top 25 revenue generating customers under the Customer
Agreements and copies of the foregoing Customer Agreements have been made
available to Merger Subsidiary, and (iii) a list of any Customer Agreement
which contains any provision that allows the customer to acquire ownership
interest in or to the Product.


 


(e)           Except as set forth in Section
4.11(e) of the Company Disclosure Letter, neither the Company nor any of the
Subsidiaries has granted to any Person, and no Person, other than the Company
(including any independent contractors who have performed services for the
Company or the Subsidiaries),  is
authorized to produce, support, maintain, distribute, sublicense, or resell any
of the Products.  Except as set forth in
Section 4.11(e) of the Company Disclosure Letter, there are no exclusive
arrangements between the Company or any of the Subsidiaries and any other
Person to license, sublicense, sell, use or distribute any of the
Products.  Section 4.11(e) of the
Company Disclosure Schedule sets forth a true and complete list of all
agreements by the Company or the Subsidiaries with resellers of the Products
and all agreements pursuant to which the Company or the Subsidiaries are
resellers of products.


 


(f)            All third party rights to use any
future version of the Products is governed by a Customer Agreement.


 


33

















 


(g)           Section 4.11(g) of the Company
Disclosure Letter sets forth a true and complete list of customer names for all
Customer Agreements.


 


(h)           Except with respect to the Company’s
or a Subsidiaries’ obligation to provide general maintenance services pursuant
to a Customer Agreement and except as set forth in Section 4.11(h) of the
Company Disclosure Letter, no Customer Agreement or other agreement obligates
the Company or any of the Subsidiaries to develop or provide any specific
improvement, enhancement, change in functionality or other alteration in the
performance of the Products.


 


Section 4.12.          Agreements, Contracts and
Commitments.  Except for
Contracts filed as exhibits to Company SEC Documents pursuant to Item 601 of
Regulation S-K and listed on the exhibit index to the Company’s annual report
on Form 10-K for the fiscal year ended December 31, 2002 (“SEC Contracts”), or as disclosed in Section
4.12 of the Company’s Disclosure Letter, neither the Company nor any of its
Subsidiaries is a party to or bound by any Contract currently in effect and of
the following nature (collectively, the “Company
Material Contracts”):


 


(a)           Contracts (other than Benefit Plans,
which are covered under Section 4.15) with any current or former employee,
director or officer of, or consultant of or to, the Company or any of its
Subsidiaries under which the Company or its Subsidiaries may have ongoing or
future payment obligations for services rendered or to be rendered;


 


(b)           Contracts that (x) involve the
performance by the Company or any of its Subsidiaries of services of an amount
or value (as measured by the revenue derived therefrom during the fiscal year
ended December 31, 2002) in excess of $100,000 annually or (y) involve payments
by the Company or any of its Subsidiaries in excess of $50,000 annually, unless
terminable by the Company on not more than 30 days notice without material
penalty;


 


(c)           Contracts (i) for the sale of assets
of the Company or any of its Subsidiaries involving aggregate consideration of
$50,000 or more (other than licenses of Products in the ordinary course of
business), or (ii) for the grant to any Person of any preferential rights to
purchase any material amount of assets or any material asset of the Company or
any of its Subsidiaries;


 


(d)           Contracts for the acquisition, by
merging or consolidating with, by purchasing an equity interest in or a portion
of the assets of, or by any other manner having the same or similar effect, any
business or any Person or assets of any Person (other than the purchase of
equipment, inventories and supplies in the ordinary course of business
consistent with past practice);


 


(e)           Contracts (including loan agreements,
credit agreements, notes, bonds, mortgages or other agreements, indentures or
instruments) relating to indebtedness for borrowed money, letters of credit,
the deferred purchase price of property, conditional sale arrangements, capital
lease obligations, obligations secured by a Lien, or interest rate or currency
hedging activities (including guarantees or other contingent liabilities in
respect of any of the foregoing but in any event excluding trade payables
arising in the ordinary course of business consistent 


 


34

















 


with past
practice, intercompany indebtedness shown on the Company’s balance sheet as of
December 31, 2002 included in the Company SEC Documents and immaterial leases
for telephones, copy machines, facsimile machines and other office equipment);


 


(f)            Loans or advances to (other than
advances to employees in respect of travel and entertainment expenses in the
ordinary course of business in amounts of $10,000 or less to any individual on
any date of determination, and $50,000 in the aggregate on any date of
determination), or investments in, any Person, other than the Company or a
Subsidiary, or any Contracts relating to the making of any such loans, advances
or investments or any Contracts involving a sharing of profits (except for
bonus arrangements with employees entered into in the ordinary course of
business consistent with past practice);


 


(g)           Contracts relating to any joint
venture, partnership, strategic alliance or similar arrangement (including any
franchising agreement);


 


(h)           Contracts to be performed relating to
capital expenditures of the Company and/or its Subsidiaries with a value in
excess of $20,000 in any fiscal year, or in the aggregate capital expenditures
of the Company and/or its Subsidiaries with a value in excess of $200,000;


 


(i)            Contracts relating to any material
Company Permits;


 


(j)            Contracts which contain restrictions
with respect to payment of dividends or any other distribution in respect of
its capital stock;


 


(k)           Contracts containing covenants
purporting to restrict the Company or any of its Subsidiaries or its or their
affiliates from competing with or otherwise materially restraining, limiting or
impeding the Company’s or any of its Subsidiaries’ ability to compete with any
Person or conduct any business or line of business or which materially restrict
any other Person from competing with the Company, any of its Subsidiaries or
any of its or their affiliates;


 


(l)            Contracts which are material to the
Company or any of its Subsidiaries and which restrict the Company or any of its
Subsidiaries from disclosing any information concerning or obtained from any
other Person (other than Contracts entered into in the ordinary course of
business);


 


(m)          Contracts required to be disclosed
under Item 404 of Regulation S-K under the Securities Act;


 


(n)           Contracts required to be filed under
Item 601(b)(10) of Regulation S-K under the Securities Act; and


 


(o)           Contracts that contain minimum annual
purchase obligations (take-or-pay) or that contain penalties or repricing
provisions (e.g., “retroactive discounts”) if certain minimum quantities
are not purchased in excess of $10,000 individually and $50,000 in the
aggregate.


 


Each Company Material Contract
and SEC Contract is in full force and effect, is a valid and binding obligation
of the Company or the Subsidiary of the Company party thereto and, to the
Company’s Knowledge, each other party thereto, except as would not reasonably be
expected to 


 


35

















 


(x) result in a material loss or liability to the Company or its
Subsidiaries or (y) interfere in a material manner with the business or
operations of the Company and its Subsidiaries or the ownership of their
properties or assets.  There exists no
default or event of default or event, occurrence, condition or act (including
the consummation of the transactions contemplated hereby) on the part of the
Company or any Subsidiary or, to the Company’s Knowledge, on the part of any
other party to any Company Material Contract that, with the giving of notice or
the lapse of time or both, would become a default or event of default under any
Company Material Contract or SEC Contract that could reasonably be expected to
(x) result in a material loss or liability to the Company or its Subsidiaries
or (y) interfere in a material manner with the business or operations of the
Company and its Subsidiaries or the ownership of their properties or assets.


 


Section
4.13.          Litigation. 
(a) Except as set forth in the Company SEC Documents filed prior to the
date of this Agreement or in Section 4.13 of the Company Disclosure Letter,
there are no Actions or Proceedings pending against or, to the Company’s
Knowledge, threatened against or binding upon the Company or any of its
Subsidiaries, or any of their respective properties or rights that could
reasonably be expected to (x) result in a material loss or liability to the
Company or its Subsidiaries, (y) interfere in a material manner with the
business or operations of the Company and its Subsidiaries or the ownership of
their properties or (z) prevent the transactions contemplated by this
Agreement.


 


(b)           Neither the Company nor any of its
Subsidiaries is a party to any Governmental Directive mandating any conduct
material to the business or operations of the Company and its Subsidiaries or
prohibiting any conduct material to the business or operations of the Company
and its Subsidiaries by any of them or subject to any commitment letter or
similar undertaking material to the business or operations of the Company and
its Subsidiaries executed in connection with any such Governmental Directive or
has adopted any board resolution with respect to any such Governmental Directive.


 


Section
4.14.          Environmental Matters.  (a) The operations of the Company and its
Subsidiaries are in compliance with Environmental Laws, except for such
noncompliance that would not, individually or in the aggregate, be reasonably
likely to result in a Company Material Adverse Effect.


 


(b)           Each of the Company and its
Subsidiaries has obtained and is in compliance with all necessary permits or
authorizations required under Environmental Laws, except for such failure to
have, or noncompliance with, such permits or authorizations that would not,
individually or in the aggregate, be reasonably likely to have a Company
Material Adverse Effect with respect to the Company and its Subsidiaries.


 


(c)           There has been no release to the
environment of any substances defined as hazardous under any Environmental Law
associated with any Company operations at any of the properties operated by the
Company and its Subsidiaries while such properties were operated by the Company
or any of its Subsidiaries that could reasonably be expected to result in a
material liability to the Company.


 


(d)           No claims have been asserted against
the Company or any of its Subsidiaries under any Environmental Law (“Environmental Claims”), nor has the Company
or 


 


36

















 


any of its
Subsidiaries received written notice of any threatened or pending Environmental
Claims against the Company or any of its Subsidiaries and, to the Company’s
knowledge, there is no valid basis for any such Environmental Claim that could
reasonably be expected to result in material liability to the Company.


 


Section
4.15.          Employee Benefit Plans.  (a) Section 4.15(a) of the Company
Disclosure Letter sets forth a true, complete and correct list of all Benefit
Plans.  The Benefit Plans are in
substantial compliance with the requirements of all applicable Laws and each
Benefit Plan has been operated, maintained and administered in substantial
compliance with its terms.  There are no
pending, nor, to the Company’s Knowledge, has the Company or any of its
Subsidiaries received notice of any threatened, Actions or Proceedings, against
or otherwise involving any of the Benefit Plans and their assets.  All contributions required to be made as of
the date of this Agreement to the Benefit Plans have been made or provided for.


 


(b)           (i) Any U.S. Benefit Plan intended to
be qualified under Section 401(a) of the Code has been determined by the IRS to
be so qualified and no Benefit Plan has been amended since the effective date
of its most recent determination letter prior to the end of its remedial
amendment period, in any material respect that would result in its
disqualification; (ii) each of the Company, its Subsidiaries and each of their
Affiliates has submitted each U.S. Benefit Plan intended to be qualified under
Section 401(a) of the Code for a determination letter in accordance with
Revenue Procedure 2001-55; (iii) neither the Company nor any of its
Subsidiaries nor any of their ERISA Affiliates has any material liability
(contingent or otherwise) under Title IV of ERISA (other than for the payment
of premiums, none of which are overdue) or has incurred or expects to incur any
liability in connection with an “accumulated funding deficiency” within the
meaning of Section 412 of the Code, whether or not waived; (iv) neither the
Company nor any of its Subsidiaries has incurred or expects to incur any
material liability (including additional contributions, fines, taxes or
penalties) as a result of a failure to administer or operate any Benefit Plan
that is a “group health plan” (as such term is defined in Section 607(1) of
ERISA or Section 5000(b)(1) of the Code) in compliance with the applicable
requirements of Part 6 of Subtitle B of Title I of ERISA or Section 4980B of
the Code (“COBRA”); (v) except as
set forth in Section 4.15(b)(v) of the Company Disclosure Letter, any U.S.
Benefit Plan providing for health and welfare benefits is fully insured; (vi)
no reportable event (as defined in Section 4043(c) of ERISA) has occurred or is
expected to occur with respect to any Pension Plan; (vii) neither the Company
nor any of its Subsidiaries nor any of their ERISA Affiliates has incurred any
withdrawal liability with respect to a “multiemployer plan” under Title IV of
ERISA and no event or condition has occurred which would be expected to cause
the Company, any Subsidiary of the Company, or any ERISA Affiliate to incur
such withdrawal liability; or (viii) neither the Company, any Subsidiary of the
Company nor any of their ERISA Affiliates has incurred any liability or penalty
under Section 4975 of the Code or Section 502(i) of ERISA with respect to any
U.S. Benefit Plan, or has engaged in a “prohibited transaction” (as defined in
Section 4975 of the Code or Section 406 of ERISA).  Except as set forth in Section 4.15 of the Company Disclosure
Letter, the execution of this Agreement and consummation of the Merger as set
forth therein will not (either alone or upon the occurrence of any additional
or subsequent events) constitute an event under any plan, policy, arrangement
or agreement or any trust or loan that will or may result in any payment
(whether of severance pay or otherwise), acceleration, forgiveness or
indebtedness, vesting, distribution, increase in benefits or obligation to fund
benefits with respect to any current or former employees of the Company or 


 


37

















 


any of its
Subsidiaries (whether or not any such payment would constitute a “parachute
payment” or “express parachute payment” within the meaning of Section 280G of
the Code).


 


(c)           Except as set forth in Section
4.15(c) of the Company Disclosure Letter, neither the Company nor any of its
Subsidiaries, nor any Affiliate of the Company maintains or is required to
contribute to any Foreign Pension Plan to which the Company would have any
liability.


 


(d)           Except as set forth in Section
4.15(d) of the Company Disclosure Letter, and as required under Section 4980B
of the Code or other applicable Law, neither the Company nor any of its
Subsidiaries has any obligation to provide post-retirement or post-termination
of employment, health or life benefits to current or former employees.  Except as set forth in Section 4.15(d) of
the Company Disclosure Letter, any continuation coverage provided under any
welfare benefits plan complies with Section 4980B of the Code and is at the
expense of the participant or beneficiary.


 


(e)           Any terminated Benefit Plan has been
terminated in accordance with applicable Laws and all benefits under any such
terminated Benefit Plan have been made in accordance with the terms of such
Benefit Plan.


 


(f)            Each Benefit Plan may be amended or
terminated at any time after the Closing Date without liability to the Company.


 


(g)           The Company has made available to
Parent and Merger Subsidiary true and complete copies of the Benefit Plans,
together with all amendments thereto, and to the extent applicable (i) all
current summary plan descriptions; (ii) the annual report on Internal Revenue
Service Form 5500-series, including any attachments thereto, for each of the
last three plan years; (iii) the most recent accountant’s report, if any; and
(iv) the most recent Internal Revenue Service determination letter.


 


Section
4.16.          Compliance with Laws.  Neither the Company nor any of the Subsidiaries
are in violation of, nor have any of them received any notice alleging any such
violation with respect to, any applicable provisions of any Laws the violation
of which could reasonably be expected to (x) result in a material loss or
liability to the Company or its Subsidiaries or (y) interfere in a material
manner with the business or operations of the Company and its Subsidiaries or
the ownership of their properties or assets. 
No investigation or review by any Governmental Entity with respect to the
Company or any of its Subsidiaries is pending or, to the Company’s Knowledge,
threatened, nor, to the Company’s Knowledge, has any Governmental Entity
indicated an intention to conduct the same that could reasonably be expected to
(x) result in a material loss or liability to the Company or its Subsidiaries
or (y) interfere in a material manner with the business or operations of the
Company and its Subsidiaries or the ownership of their properties or assets.


 


Section
4.17.          Permits and Licenses.  The Company and each of the Subsidiaries
have obtained and have complied with, and are in compliance with, all Company
Permits and there has not occurred any default under any such Company Permit
and no Action or Proceeding has been filed or commenced against any of them
alleging any failure to so comply, except such 


 


38

















 


failure to
obtain, noncompliance, default, Action or Proceeding as would not, individually
or in the aggregate, reasonably be expected to result in a Company Material
Adverse Effect.  There are no material
oral or written understandings or waivers between the Company or any of its
Subsidiaries, on the one hand, and any Governmental Entity, on the other, with
respect to any material Company Permit.


 


Section
4.18.          Labor Matters. 
(a) Neither the Company nor any of its Subsidiaries is a party to or
otherwise bound by any collective bargaining agreement, contract or other
agreement or understanding with a labor union or labor organization.


 


(b)           Except as set forth in Section
4.18(b) of the Company Disclosure Letter, (i) there is no material pending or
to the Company’s Knowledge threatened labor strike, or dispute, walkout, work
stoppage, slow-down, lockout or organizational effort involving employees of
the Company or any of its Subsidiaries, (ii) (x) as of the date hereof, there
is no unfair labor practice charge or complaint against the Company or any of
its Subsidiaries, either pending or, to the Company’s Knowledge, threatened and
(y) as of the Effective Time there will be no material unfair labor practice
charge or complaint against the Company or any of its Subsidiaries, either
pending or, to the Company’s Knowledge, threatened; (iii) no union is currently
certified, and there is no union representation question and no union or other
organizational activity that would be subject to the National Labor Relations
Act (20 U.S.C. §151 et  seq.) exists or, to the Company’s
Knowledge, is threatened with respect to the Company’s or any of its
Subsidiaries’ operations, (iv) there are no material occupational health and
safety claims against the Company or any of its Subsidiaries, and (v) except as
set forth in Section 4.18(b) of the Company Disclosure Letter, (x) as of the
date hereof there are no complaints, charges, or claims against the Company or
any of its Subsidiaries pending, or to the Company’s Knowledge threatened in
writing to be brought or filed, and (y) as of the Effective time there will be
no material complaints, charges, or claims against the Company or any of its
Subsidiaries pending, or to the Company’s Knowledge threatened in writing to be
brought or filed with any authority or arbitrator based on, arising out of, in
connection with, or otherwise relating to the employment or termination of employment
or any individual by the Company.


 


(c)           Neither the Company nor any of its
Subsidiaries has effectuated (i) a “plant
closing” (as defined in the WARN Act) affecting any site of
employment or one or more facilities or operating units within any site of
employment of the Company or any Subsidiary; or (ii) a “mass layoff” (as defined in the WARN Act)
affecting any site of employment or facility of the Company or any of its
Subsidiaries; nor has the Company and/or any Subsidiary been engaged in layoffs
or employment terminations sufficient in number to trigger application of any
similar state or local law; and none of the affected employees has suffered an
“employment loss” (as defined in
the WARN Act) since ninety days prior to the date hereof.  Neither the Company nor any of its
Subsidiaries has incurred any material liability under the WARN Act or similar
state laws which remains unpaid of unsatisfied.


 


(d)           Except as set forth in Section
4.18(d) of the Disclosure Letter, (i) the Company and its Subsidiaries are in
material compliance with the terms and provisions of the Immigration Reform and
Control Act of 1986, as amended, and all related regulations promulgated
thereunder,  (ii) the Company and its
Subsidiaries are in material compliance with all laws governing the employment
of its employees, including, but not limited to, all such 


 


39

















 


federal,
state, and local laws relating to wages, hours, collective bargaining,
discrimination, retaliation, civil rights, safety and health, workers’
compensation and the collection and payment of withholding and/or Social
Security taxes and similar taxes, (iii) no employee or independent contractor
has filed a complaint for which the Company has received notice and the Company
has not conducted any internal investigation regarding conduct that may
constitute a violation of any federal, state or local law governing employment,
(iv) since December 31, 2002, no officer or employee of the Company or any of
its Subsidiaries has received, and no officer has given, notice to terminate
his employment, (v) there are no officers or employees of the Company or any of
its Subsidiaries who are on secondment, maternity leave or absent on grounds of
disability, military or other leave of absence (other than normal holidays or
absence due to illness), (vi) the Sellers and the Company and its Subsidiaries
have complied with their material obligations to inform and consult with trade
unions and other representatives of workers and to send notices to relevant
governmental officials, (vii) the Company and its Subsidiaries have maintained
adequate and suitable records regarding the service of their directors,
officers and employees and such records comply with requirements of data
protection legislation regarding the processing and storage of personal data on
individuals except as would not reasonably be expected to (x) result in a
material loss or liability to the Company or its Subsidiaries or (y) interfere
in a material manner with the business or operations of the Company and its
Subsidiaries or the ownership of their properties or assets and (viii) the
Company and its Subsidiaries have not entered into any agreement and no event
has occurred which may involve the Company and its Subsidiaries in the future
acquiring any undertaking or part of one such that the Transfer Regulations may
apply thereto except as would not reasonably be expected to (x) result in a
material loss or liability to the Company or its Subsidiaries or (y) interfere
in a material manner with the business or operations of the Company and its
Subsidiaries or the ownership of their properties or assets.


 


(e)           All salaries and wages and other
benefits, bonuses and commissions of all directors, officers or employees of
the Company and its Subsidiaries have, to the extent due, been paid or
discharged in full, including but not limited all payments due under the 2002
Results Incentive Plan and the 2002 Utilization Bonus Plan and the 2002
Sales/Business Solutions Plan.


 


(f)            Neither the Company nor its
Subsidiaries have entered into any agreement or arrangement for the management
or operation of its business or any part thereof other than with their
respective employees.


 


(g)           Except as set forth in Section
4.18(g) of the Disclosure Letter, neither the Company nor any of its
Subsidiaries has extended a loan to any employee for which amounts are
outstanding, except for advances in respect of travel and entertainment
expenses in the ordinary course of business. 
Since December 31, 2002, no such loans have been forgiven.


 


(h)           Except as set forth in Section
4.18(h) of the Disclosure Letter, neither the Company nor any of its
Subsidiaries is a party to any oral or written:  (i) agreement with any executive officer or employee of the
Company or any of its Subsidiaries (A) the benefits of which are contingent, or
the payment or terms of which are accelerated or materially altered, upon the
occurrence of a transaction involving the Company or any of its Subsidiaries of
the nature of any of the transactions contemplated by this Agreement, (B)
providing any term of 


 


40

















 


employment or
compensation guarantee or (C) providing severance benefits or other benefits
after the termination of employment of such executive officer or employee; or
(ii) agreement or plan binding the Company or any of its Subsidiaries,
including any stock option plan, stock appreciate right plan, restricted stock
plan, stock purchase plan, severance benefit plan, insurance plan or
arrangement (including with respect to life, health, or disability insurance)
or with respect to the premium therefore, any of the benefits of which shall be
increased, or the vesting of the benefits of which shall be accelerated, by the
occurrence of any of the transactions contemplated by this Agreement (either
alone or upon the occurrence of any additional or subsequent event) or the
value of any of the benefits of which shall be calculated on the basis of any
of the transactions contemplated by this Agreement (such agreements and plans
referred to in clause (i) or (ii), collectively, the “Executive Agreements”).


 


(i)            All current employees of the Company
and its Subsidiaries have signed the Employee Proprietary Information and
Inventions Agreement.


 


Section
4.19.          Insurance. 
Section 4.19 of the Company Disclosure Letter sets forth the material
insurance coverages maintained by the Company and its Subsidiaries.  The Company has made available to Parent and
Merger Subsidiary copies of all material insurance policies which are owned by
the Company or its Subsidiaries or which name the Company or any of its
Subsidiaries as an insured, additional insured or loss payee (including those
pertaining to the Company’s or any of its Subsidiaries’ assets, employees or
operations) (collectively, the “Insurance
Policies”) and (a) each of the Insurance Policies is in full force
and effect and is valid, outstanding and enforceable, and all premiums due
thereon have been paid in full and cover against the risks of the nature
normally insured against by entities in the same or similar lines of business
as the Company and its Subsidiaries in coverage amounts typically and
reasonably carried by such entities, (b) none of the Insurance Policies shall
terminate or lapse (or be affected in any other material adverse manner) by
reason of the Merger, (c) each of the Company and its Subsidiaries has complied
in all material respects with the provisions of each Insurance Policy under
which it is the insured party, (d) to the Knowledge of the Company, no insurer
under any Insurance Policy has cancelled or generally disclaimed liability
under any such Insurance Policy or indicated any intent to do so or not to
renew any such Insurance Policy and (e) to the Knowledge of the Company, all material
claims under the Insurance Policies have been filed in a timely fashion.


 


Section
4.20.          Information in Proxy Statement.  The Proxy Statement when distributed or
otherwise disseminated to the Company’s stockholders, as applicable, will
comply as to form in all material respects with all applicable requirements of
the Exchange Act and other applicable Laws. 
If at any time prior to the date of the Special Meeting any event occurs
which should be described in an amendment or supplement to the Proxy Statement,
the Company will file and disseminate, as required, an amendment or supplement
which complies as to form in all material respects with the Exchange Act and
any other applicable Laws.


 


Section
4.21.          Opinion of Financial Advisor.  The Board of Directors of the Company has
received the written opinion of Updata Capital, Inc., dated May 8, 2003, a
true, complete and correct signed copy of which shall be delivered to Parent
promptly after receipt of a written copy thereof by the Company, to the effect
that, as of the date of such written opinion and on the basis of and subject to
the assumptions set forth therein, the Cash Merger 


 


41

















 


Consideration
to be received in the Merger by the holders of Company Common Stock, is fair to
such holders from a financial point of view, and such opinion has not been
withdrawn or modified as of the date of this Agreement.  The Company has been authorized by Updata
Capital, Inc. to permit the inclusion of such fairness opinion in the Proxy
Statement.


 


Section
4.22.          Brokers.  No
agent, broker, Person or firm acting on behalf of the Company or any of its
Subsidiaries other than Updata Capital, Inc. is or will be entitled to any
advisory commission or broker’s or finder’s fee from any of the Parties (or
their respective Affiliates) in connection with this Agreement or any of the
transactions contemplated hereby.  All
amounts paid, or which are or will be payable, to Updata Capital, Inc. arising
out of or in connection with this transaction are set forth on Section 4.22 of
the Company Disclosure Letter.


 


Section
4.23.          Voting Requirements.  The affirmative vote of the holders of at
least a majority of the outstanding shares of Company Common Stock held by
Company Stockholders is the only vote of the holders of any class or series of
the Company’s capital stock or other securities of the Company necessary under
applicable law or stock exchange (or similar self-regulatory organization)
regulations to adopt this Agreement and approve the Transactions contemplated
hereby and for consummation by the Company of the Transactions contemplated
hereby.


 


Section
4.24.          Rights Agreement.  The Company has amended the Rights Agreement (without redeeming
the Rights (as such term is defined in the Rights Agreement) identified
therein), (a) to render the Rights Agreement inapplicable with respect to this
Agreement, the Voting Agreement and Transactions (b) so that (i) neither the
Parent nor the Merger Subsidiary nor any of their “Affiliates” or “Associates”
(as such terms are defined in the Rights Agreement) is considered to be an
“Acquiring Person”, “Interested Stockholder” or “Transaction Person” (as such
terms are defined in the Rights Agreement) as a result of the announcement or
execution of this Agreement or the Voting Agreement or the consummation of the
Transactions and (ii) the provisions of the Rights Agreement, including the
occurrence of a “Distribution Date”, a “Shares Acquisition Date” or a
“Transaction” (as such terms are defined in the Rights Agreement) and Sections
11(a)(ii) and 13(a) of the Rights Agreement, are not and shall not be triggered
by reason of the announcement or execution of this Agreement or the Voting
Agreement or the consummation of the Transactions and (c) to cause the Rights
to expire immediately prior to the Effective Time.


 


Section
4.25.          State Takeover Statutes.  The Board of Directors of the Company has
taken any and all requisite action so that neither the restrictions on
“business combinations” set forth in Section 203 of the DGCL, nor any other
“moratorium”, “control share”, “fair price”, “affiliate transaction”, “business
combination” or other antitakeover laws of any state other than the State of
Delaware, will apply to this Agreement or the Voting Agreement or to the Merger
or any of the other Transactions.


 


42

















 


ARTICLE V


 


REPRESENTATIONS AND WARRANTIES OF PARENT, 

ACQUISITION SUBSIDIARY AND MERGER SUBSIDIARY


 


Each of
Parent, Acquisition Subsidiary and Merger Subsidiary hereby represents and
warrants to the Company that:


 


Section
5.1.            Organization. 
Each of Parent, Merger Subsidiary and Acquisition Subsidiary is a
corporation duly organized, validly existing and in good standing under the
Laws of its jurisdiction of organization and has all requisite corporate power
and authority to own, lease and operate its properties and assets and to carry
on its business as it is currently being conducted.  Each of Parent, Merger Subsidiary and Acquisition Subsidiary is
duly qualified or licensed to do business, and is in good standing as a foreign
corporation in each jurisdiction where the character of its properties or
assets owned, operated and leased or the nature of its activities makes such
qualification necessary, except where the failure to be so qualified or
licensed or in good standing has not resulted in and would not reasonably be
likely to result in, individually or in the aggregate, a material adverse
effect on either Parent, Merger Subsidiary or Acquisition Subsidiary or
materially impair the ability of either Parent, Merger Subsidiary or
Acquisition Subsidiary to consummate the transactions contemplated hereby.  Each of Parent, Merger Sub and Acquisition
Subsidiary has, prior to the date of this Agreement, delivered to the Company
true, complete and correct copies of their respective Certificate of
Incorporation and the By-laws (or other comparable governing documents), in
each case as amended and in full force and effect as of the date of this
Agreement.


 


Section
5.2.            Authorization; Validity of
Agreement; Necessary Action. 
Each of Parent, Merger Subsidiary and Acquisition Subsidiary has full
corporate power and authority to execute and deliver this Agreement and each
instrument required hereby to be executed and delivered by it prior to or at
the Effective Time, to perform its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby.  The execution, delivery and performance by each of Parent, Merger
Subsidiary and Acquisition Subsidiary of this Agreement and each instrument
required hereby to be executed and delivered by it prior to or at the Effective
Time and the performance of its obligations hereunder and thereunder and the
consummation by it of the Transactions have been duly authorized by the Board
of Directors of each of Parent, Merger Subsidiary and Acquisition Subsidiary,
and, except for the adoption of this Agreement by Parent as the sole
stockholder of Merger Subsidiary, no other corporate action on the part of
Parent, Merger Subsidiary or Acquisition Subsidiary is necessary to authorize
the execution, delivery and performance by Parent, Merger Subsidiary and
Acquisition Subsidiary of this Agreement and the consummation by them of the
transactions contemplated hereby.  This
Agreement and each instrument required hereby to be executed and delivered
prior to the Effective Time has been duly executed and delivered by each of
Parent, Merger Subsidiary and/or Acquisition Subsidiary, as the case may be,
and, assuming due and valid authorization, execution and delivery hereof by the
Company, is a valid and binding obligation of each of Parent, Merger Subsidiary
and/or Acquisition Subsidiary, as the case maybe, enforceable against each of
them in accordance with its terms.


 


43

















 


Section
5.3.            Consents and Approvals; No
Violations.  The execution and
delivery of this Agreement by Parent, Merger Subsidiary and Acquisition
Subsidiary does not, and the consummation by Parent, Merger Subsidiary and
Acquisition Subsidiary of the Transactions and the compliance by Parent, Merger
Subsidiary and Acquisition Subsidiary with the applicable provisions of this
Agreement will not:


 


(a)           violate or conflict with or result in
any breach of any provision of the Certificate of Incorporation or the By-laws
of Parent or the Certificate of Incorporation or the By-laws of Merger
Subsidiary or Acquisition Subsidiary;


 


(b)           require any filing, recordation,
declaration or registration with, or permit, order, authorization, consent or
approval of, or action by or in respect of, or the giving of notice to, any
Governmental Entity, except for (i) the Governmental Approvals with respect to
the Merger and the transactions contemplated hereby and (ii) the filing of the
Certificate of Merger with the Secretary of State of the State of Delaware, all
other filings or recordings required under the DGCL and appropriate documents
with the relevant authorities of other states in which Parent, Merger
Subsidiary or Acquisition Subsidiary qualified to do business;


 


(c)           result in a violation or breach of,
conflict with, constitute (with or without due notice or lapse of time or both)
a default under, give rise to any penalty, right of amendment, modification,
renegotiation, termination, cancellation, payment or acceleration or any right
or obligation or loss of any material benefit or right under, or result in the
creation of any Liens upon any of the properties or assets of Parent, Merger
Subsidiary or Acquisition Subsidiary under, any of the terms, conditions or
provisions of any loan or credit agreement, note, bond, mortgage, indenture,
lease, license, sublicense, franchise, permit, concession, agreement, contract,
obligation, commitment, understanding, arrangement, franchise agreement or
other instrument, obligation or authorization applicable to Parent, Merger
Subsidiary or Acquisition Subsidiary, or by which any such Person or any of its
properties or assets may be bound; or


 


(d)           violate or conflict with any Laws
applicable to Parent, Merger Subsidiary or Acquisition Subsidiary or by which
any of their properties or assets may be bound;


 


excluding from preceding
clauses (b), (c) and (d) such matters that have not resulted in and would not
reasonably be likely to result in, individually or in the aggregate, a material
adverse effect on either Parent, Merger Subsidiary or Acquisition Subsidiary
and would not materially impair the ability of either Parent, Merger Subsidiary
or Acquisition Subsidiary to consummate the Transactions.


 


Section
5.4.            Sufficiency of Funds.  At the Closing of the Asset Purchase and at
the Effective Time, as applicable, (x) Parent shall have funds on hand or
available financing in an amount sufficient to pay (i) all of the Cash Merger
Consideration, (ii) all of the Option Consideration, and (iii) all fees and
expenses payable by Parent, Merger Subsidiary and/or Acquisition Subsidiary
related to the transactions contemplated by this Agreement and the Ancillary
Agreements and (y) Acquisition Subsidiary shall have funds on hand or available
financing in an amount sufficient to pay the Purchase Price.  Upon completion of the Transactions
(including, without limitation, the deposit of the Payment Fund), the Parent
intends that the Surviving Corporation will have cash and cash equivalents of
at least $5 million and 


 


44

















 


Parent will
not cause Surviving Corporation to incur any indebtedness in connection with
the consummation of the Transaction.  At
the Effective Time, Acquisition Subsidiary shall enter into a license with the
Surviving Corporation to provide the Surviving Corporation with such rights in
the Owned Intellectual Property as are necessary to conduct the business of the
Surviving Corporation with respect to its currently existing properties and
assets in substantially the same manner that it was conducted prior to the sale
of the Owned Intellectual Property.


 


Section
5.5.            Information in Proxy Statement.  None of the information supplied or to be supplied
by Parent, Merger Subsidiary and/or Acquisition Subsidiary in writing relating
to Parent, Merger Subsidiary, Acquisition Subsidiary or any Affiliate thereof
(other than the Company or any of its Subsidiaries), as the case may be,
expressly for inclusion or incorporation by reference in the Proxy Statement,
any amendment or supplement thereto or any other documents filed with the SEC
by the Company in connection with the Transactions, when supplied to the
Company, when filed with the SEC and, in case of the Proxy Statement, when
mailed to the stockholders of the Company and at the time of the Special
Meeting, will contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances under which they are
made, not misleading.  Notwithstanding
the foregoing, Parent, Merger Subsidiary and Acquisition Subsidiary make no
representation or warranty with respect to any information supplied by the
Company in writing relating to the Company or any Affiliate thereof (other than
Parent, Merger Subsidiary or Acquisition Subsidiary) expressly for inclusion or
incorporation by reference in the Proxy Statement.


 


Section
5.6.            Litigation. 
(a) There is no suit, claim, action, proceeding or investigation pending
or, to the knowledge of Parent, threatened against Parent, Merger Subsidiary or
Acquisition Subsidiary and (b) neither Parent, Merger Subsidiary nor
Acquisition Subsidiary is subject to any outstanding order, writ, judgment,
injunction or decree of any Governmental Entity which, in the case of (a) or
(b), would, individually or in the aggregate, reasonably be expected to prevent
or materially delay Parent’s, Merger Subsidiary’s or Acquisition Subsidiary’s
ability to consummate the Merger.


 


Section
5.7.            Ownership of Merger Subsidiary;
No Prior Activities.


 


(a)           Each of Merger Subsidiary and
Acquisition Subsidiary was formed solely for the purpose of engaging in the
transactions contemplated by this Agreement.


 


(b)           Except for obligations or liabilities
incurred in connection with its incorporation or organization and the
transactions contemplated by this Agreement and each Ancillary Agreement,
neither Merger Subsidiary nor Acquisition Subsidiary has, and neither Merger
Subsidiary nor Acquisition Subsidiary will have, incurred, directly or
indirectly, through any subsidiary or affiliate, any obligations or liabilities
or engaged in any business activities of any type or kind whatsoever or entered
into any agreements or arrangements with any person.


 


Section
5.8.            Brokers.  No
broker, finder or investment banker is entitled to any brokerage, finder’s or
other fee or commission in connection with the Merger based upon arrangements
made by or on behalf of Parent, Merger Subsidiary or Acquisition Subsidiary.


 


45

















 


ARTICLE VI


 


COVENANTS


 


Section
6.1.            Interim Operations of the Company.  Except as (i) set forth on Section 6.1 of
the Company Disclosure Letter, (ii) expressly provided herein or (iii)
consented to in writing by Parent (such consent not to be unreasonably
withheld), from and after the date of this Agreement until the earlier of the
termination of this Agreement in accordance with its terms or the Effective
Time, the Company shall, and shall cause each of its Subsidiaries to, act and
carry on its business only in the ordinary course of business consistent with
past practice and use reasonable best efforts to maintain and preserve its and
its Subsidiaries’ business organization, assets and properties, keep available
the services of its officers and key employees and maintain and preserve its
advantageous business relationships with customers, clients, suppliers and
others having material business dealings with it.  Without limiting the generality of the foregoing, from and after
the date of this Agreement until the earlier of the termination of this
Agreement in accordance with its terms or the Effective Time, the Company shall
not, and shall not permit any of its Subsidiaries to, directly or indirectly,
do any of the following without the prior written consent of Parent (such
consent not to be unreasonably withheld) except as otherwise contemplated by
Section 6.1 of the Company Disclosure Letter:


 


(a)           except as contemplated by Section
2.1, amend its Amended and Restated Certificate of Incorporation, as amended,
or By-laws or comparable governing documents;


 


(b)           sell, transfer or pledge or agree to
sell, transfer or pledge any shares of capital stock or other equity interests
owned by it in any other Person;


 


(c)           declare, set aside or pay any
dividend or other distribution payable in cash, securities or other property
with respect to, or split, combine, redeem or reclassify, or purchase or
otherwise acquire, any shares of its capital stock (or other equity interests)
or other securities of the Company or any of its Subsidiaries, other than the
making of a dividend or other distribution by a wholly-owned Subsidiary to
another wholly-owned Subsidiary or to the Company, or any other change in the
capital structure of the Company on any of its Subsidiaries;


 


(d)           except as contemplated by Sections
2.1 and 3.1 or as set forth in Section 6.1(d) of the Company Disclosure Letter,
issue or sell, or authorize to issue or sell, any shares of its capital stock
(whether unrestricted or restricted) or any other securities (equity or debt)
of the Company or any of its Subsidiaries, or issue or sell, or authorize to
issue or sell, any securities (equity or debt) convertible into or exchangeable
for, or options, warrants, calls, commitments or rights of any kind to purchase
or subscribe for, or enter into any arrangement or contract with respect to the
issuance or sale of, any shares of its capital stock of any class of the
Company or Voting Debt or other securities (equity or debt), or make any other
change in its capital structure, except for the possible issuance by the
Company of shares of Company Common Stock pursuant to the terms of any Options
outstanding on the date hereof and disclosed in Section 4.2(a) of the Company
Disclosure Letter;


 


(e)           acquire, authorize or make (or commit
to make) any investment in, or make any capital contribution to, any Person;


 


46

















 


(f)            make (or commit to make), or enter
into any Contracts (or any amendments, modifications, supplements or
replacements to existing Contracts) to be performed relating to the making of
capital expenditures in excess of $25,000 in any calendar year, or in the aggregate
for capital expenditures with a value in excess of $100,000;


 


(g)           acquire, by merging or consolidating
with, by purchasing an equity interest in or by purchasing all or a portion of
the assets of, or by any other manner, any business or any Person (other than
the purchase of equipment, inventories and supplies in the ordinary course of
business consistent with past practice);


 


(h)           transfer, lease, license, guarantee,
sell, mortgage, pledge, dispose of, subject to any Lien (other than a Permitted
Lien) or otherwise encumber any material assets or other assets that have a
value individually in excess of $10,000 other than with respect to (i)
transactions between a wholly-owned Subsidiary of the Company and the Company
or between wholly-owned Subsidiaries of the Company, (ii) dispositions of
excess or obsolete assets in the ordinary course of business consistent with
past practice and (iii) leases, licenses or sales of the Company’s software or
other assets in the ordinary course of business consistent with past practice;


 


(i)            except to the extent required under
existing employee and director benefit plans, agreements or arrangements in
effect as of the date hereof or required by applicable law or contemplated by
Section 3.4 or as set forth in Section 6.1(i) of the Company Disclosure Letter,
(i) increase the compensation or fringe benefits of any of its directors,
officers or employees (except for immaterial increases to employees who are not
officers of the Company or any of its Subsidiaries in the ordinary course of
business consistent with past practice) or grant any severance or termination
pay not currently required to be paid under existing severance plans, (ii)
enter into, amend, modify, supplement or replace any employment, benefit
(including with respect to life or disability insurance or with respect to
premiums therefor), consulting or severance agreement, policy or arrangement
with any present or former director, officer or other employee of the Company
or any of its Subsidiaries, or (iii) establish, adopt, enter into or amend,
modify, supplement, replace or terminate any collective bargaining, bonus,
profit sharing, thrift, compensation, stock option, restricted stock, benefit
(including with respect to life or disability insurance or with respect to
premiums therefor), pension, retirement, deferred compensation, employment,
termination, severance or other plan, agreement, trust, fund, policy or
arrangement for the collective benefit of any directors, officers or employees
(it being understood and agreed that in no event shall the Company or any of
its Subsidiaries amend, modify, supplement, replace or terminate the policy in
effect on the date hereof and described in Section 6.1(i) of the Company
Disclosure Letter, with respect to suspension of any increases in the
compensation or other remuneration of directors, officers and other employees
of the Company and its Subsidiaries);


 


(j)            except as may be required by
applicable law, GAAP or SEC rule, make any change in any of its accounting
practices, policies or procedures or any of its methods of reporting income,
deductions or other items for income tax purposes;


 


(k)           except as contemplated by Sections
2.1 and 3.1 or as set forth in Section 6.1(k) of the Company Disclosure Letter,
adopt or enter into a plan of complete or partial 


 


47

















 


liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or other
reorganization of the Company or any of its Subsidiaries or any agreement relating
to an Acquisition Proposal, except as expressly permitted in Section 6.3;


 


(l)            (i) incur, assume, modify or prepay
any indebtedness for borrowed money, issue any debt securities or warrants or
other rights to acquire debt securities, or guarantee, endorse or otherwise
become liable or responsible for the obligations or indebtedness of another
Person, other than indebtedness owing to the Company or any direct or indirect
wholly-owned Subsidiary of the Company or guarantees of indebtedness of the
Company or any direct or indirect wholly-owned Subsidiary of the Company, or
enter into any capital lease in each case, in an amount in excess of $10,000,
or (ii) make any loans, extensions of credit or advances to any other Person,
other than to the Company or to any direct or indirect wholly-owned Subsidiary
of the Company, except, in the case of preceding clauses (i) and (ii), for
loans, extensions of credit or advances constituting trade payables or
receivables arising in the ordinary course of business and in the case of
preceding clause (ii), for advances to employees in respect of travel and
entertainment expenses in the ordinary course of business in amounts of $10,000
or less to any individual on any date of determination and $50,000 in the
aggregate outstanding on any date of determination;


 


(m)          except as provided by this Agreement
or described in the Company Disclosure Letter, accelerate the payment, right to
payment or vesting of any bonus, severance, profit sharing, retirement,
deferred compensation, stock option, restricted stock, insurance (including
arrangements or agreements for the premiums therefor) or other compensation or
benefits;


 


(n)           pay, discharge, settle or satisfy any
claims, litigation, liabilities or obligations (absolute, accrued, asserted or
unasserted, contingent or otherwise) other than (i) the payment, discharge,
settlement or satisfaction, in the ordinary course of business consistent with
past practice, of (A) liabilities reflected or reserved against in the December
31, 2002 balance sheet included in the Company SEC Documents or (B) liabilities
(other than litigation) subsequently incurred in the ordinary course of
business consistent with past practice and (ii) other claims, litigation,
liabilities or obligations (qualified as aforesaid) that in the aggregate do
not exceed $25,000;


 


(o)           plan, announce, implement or
effectuate any reduction in force, lay-off, early retirement program, severance
program or other program or effort concerning the termination of employment of
employees of the Company or its Subsidiaries, other than routine employee
terminations in the ordinary course of business and consistent with past
practice;


 


(p)           take any action or omit to take any
action (including the adoption of any shareholder rights plan or amendments to
its Amended and Restated Certificate of Incorporation, as amended, or By-laws
(or comparable governing documents)) which would, directly or indirectly,
restrict or impair the ability of Parent or Merger Subsidiary, as the case may
be, to vote or otherwise to exercise the rights and receive the benefits of a
stockholder with respect to securities of the Company that may be acquired or
controlled by Parent or Merger Subsidiary, as the case may be, or any action
which would permit any Person to acquire securities of the 


 


48

















 


Company or any
of its Subsidiaries from the Company or such Subsidiary on a basis not
available to Parent or Merger Subsidiary;


 


(q)           take any action or omit to take any
action which (i) constitutes a violation of any Company Permit, which
violations would result in or would reasonably be likely to result in,
individually or in the aggregate, the modification, suspension, cancellation,
termination of any one or more Company Permits or otherwise have or would
reasonably be likely to have a material adverse impact on any customer or
client contract or relationship or the nature or level of discipline imposed on
account of future violations of the Laws applicable to the Company and the Surviving
Corporation or (ii) would (or would reasonably be likely to) materially impede,
delay, hinder or make more burdensome for the Surviving Corporation or Parent
to obtain and maintain any and all authorizations, approvals, consents or
orders from any Governmental Entity or other third party necessary or required
to maintain the Company Permits in effect as of the date hereof in effect at
all times following the Merger on the same terms as in effect on the date of
this Agreement;


 


(r)            enter into any new material line of
business or enter into any agreement that restrains, limits or impedes the
Company’s or any of its Subsidiaries’ ability to compete with or conduct any
business or line of business;


 


(s)           (i) file or cause to be filed any
materially amended Tax Returns or claims for refund; (ii) make or rescind any
material Tax election or otherwise fail to prepare all Tax Returns in a manner
which is consistent with the past practices of the Company and each Subsidiary
of the Company, as the case may be, with respect to the treatment of items on
such Tax Returns except to the extent that any inconsistency (A) would not or
may not materially increase Parent’s, the Company’s or any of the Company’s
Subsidiaries’ liability for Taxes for any period or (B) is required by Law;
(iii) incur any material liability for Taxes other than in the ordinary course
of business, apart from any Tax Liability that may result from the Asset
Purchase; or (iv) enter into any settlement or closing agreement with a taxing
authority that materially increases or would reasonably be likely to materially
increase the Tax liability of the Company or any of its Subsidiaries for any
period;


 


(t)            fail to maintain with current or
other financially responsible insurance companies insurance on its assets,
tangible and intangible, and its businesses in such amounts and against such
risks and losses as are consistent with past practice; or


 


(u)           authorize, agree or announce an
intention, in writing or otherwise, to take any of the foregoing actions or
fail to take any action that would prevent any of the foregoing from occurring.


 


Section
6.2.            Confidentiality.  The Parties acknowledge the Confidentiality Agreement, which
Confidentiality Agreement shall continue in full force and effect in accordance
with its terms, except as expressly modified herein or pursuant hereto.


 


Section
6.3.            No Solicitation of Other Offers.  (a) 
Each of the Company and its Subsidiaries shall, and shall cause its
Affiliates and each of its and their respective Representatives to, immediately
cease any discussions, activities or negotiations with any other 


 


49

















 


Person or
Persons that may be ongoing with respect to any Acquisition Proposal.  The Company and its Subsidiaries shall not
take, and shall cause their respective Representatives not to take, any action
after the date hereof (i) to encourage, solicit, initiate or facilitate,
directly or indirectly, the making or submission of any Acquisition Proposal
(including by taking any action that would make the Rights Agreement
inapplicable to an Acquisition Proposal), (ii) to enter into any agreement,
arrangement or understanding with respect to any Acquisition Proposal, other
than a confidentiality agreement referred to below or in connection with the
termination of this Agreement pursuant to Section 8.1(f), in accordance with
the terms and under the circumstances contemplated below in this Section
6.3(a), or to agree to approve or endorse any Acquisition Proposal or enter into
any agreement, arrangement or understanding that would require the Company to
abandon, terminate or fail to consummate the Transactions, (iii) to initiate or
participate in any way in any discussions or negotiations with (other than
discussions or negotiations solely related to the execution of a
confidentiality agreement referred to below), or furnish or disclose any
information to, any Person (other than Parent or Merger Subsidiary) in
furtherance of any proposal that constitutes, or could reasonably be expected
to lead to, any Acquisition Proposal, or (iv) to grant any waiver or release
under any standstill, confidentiality or similar agreement entered into by the
Company or any of its Subsidiaries or any of their Affiliates or
Representatives except to the extent the Board of Directors of the Company
determines in good faith, after consultation with outside nationally recognized
legal counsel (which may be its current outside legal counsel) that failure to
grant such waiver or release would be inconsistent with its fiduciary duties
under applicable law; provided, that so long as there has been no breach
of this Section 6.3(a), prior to obtaining the approval of the Company
Stockholders contemplated by Section 6.5, in response to a written Acquisition
Proposal that was not solicited after the date hereof and otherwise in
compliance with its obligations under Section 6.3(c), the Company may (1)
request clarifications from, or furnish information to, (but not enter into
discussions with) any Person which makes such Acquisition Proposal if (A) such
action is taken subject to a confidentiality agreement with the Company
containing customary terms and conditions; provided, that if such
confidentiality agreement contains provisions that are less restrictive than the
comparable provisions of the Confidentiality Agreement, or omits restrictive
provisions contained in the Confidentiality Agreement, then the Confidentiality
Agreement shall be deemed to be automatically amended to contain in
substitution for such comparable provisions such less restrictive provisions,
or to omit such restrictive provisions, as the case may be, and in connection
with the foregoing, the Company agrees not to waive any of the provisions in
any such confidentiality agreement without waiving the similar provisions in
the Confidentiality Agreement to the same extent, (B) such action is taken
solely for the purpose of obtaining information reasonably necessary to
ascertain whether such Acquisition Proposal is, or is reasonably likely to lead
to, a Superior Proposal, and (C) the Board of Directors of the Company
reasonably determines in good faith, after consultation with outside nationally
recognized legal counsel (which may be its current outside legal counsel), that
failure to take such actions would be inconsistent with its fiduciary duties
under applicable law or (2) participate in discussions or negotiations with,
request clarifications from, or furnish information to, any Person which makes
such Acquisition Proposal if (x) such action is taken subject to a
confidentiality agreement with the Company containing customary terms and
conditions; provided, that if such confidentiality agreement contains
provisions that are less restrictive than the comparable provisions of the
Confidentiality Agreement, or omits restrictive provisions contained in the
Confidentiality Agreement, then the Confidentiality Agreement shall be deemed 


 


50

















 


to be
automatically amended to contain in substitution for such comparable provisions
such less restrictive provisions, or to omit such restrictive provisions, as
the case may be, and in connection with the foregoing, the Company agrees not
to waive any of the provisions in any such confidentiality agreement without
waiving the similar provisions in the Confidentiality Agreement to the same
extent, (y) the Board of Directors of the Company reasonably determines in good
faith, after consultation with outside nationally recognized legal counsel
(which may be its current outside legal counsel) and financial advisor (which
may be its current outside financial advisor), that such Acquisition Proposal
is a Superior Proposal and (z) the Board of Directors of the Company reasonably
determines in good faith, after consultation with outside nationally recognized
legal counsel (which may be its current outside nationally recognized legal
counsel), that failure to take such actions would be inconsistent with its
fiduciary duties under applicable law. 
Without limiting the foregoing, Parent, Merger Subsidiary and the
Company agree that any violation of the restrictions set forth in this Section
6.3(a) by any Representative of the Company or any of its Subsidiaries or their
respective Affiliates (other than any such Person who is an Affiliate or
employee of Parent or of any of its Affiliates), whether or not such Person is
purporting to act on behalf of the Company or any of its Subsidiaries or their
respective Affiliates, shall constitute a breach by the Company of this Section
6.3(a).  It is understood that no
discussions with any Person shall give rise to a violation of this Section
6.3(a) if (i) the Company, its Subsidiaries or its Representatives, as
applicable, did not know or have reason to know that such discussion related to
an Acquisition Proposal and (ii) such discussion was immediately ceased once
the Company, its Subsidiary or Representatives, as applicable, knew or had
reason to know it related to an Acquisition Proposal.


 


(b)           Neither the Board of Directors of the
Company nor any committee thereof shall (i) withdraw, modify or amend, or
propose to withdraw, modify or amend, in a manner adverse to Parent, Merger
Subsidiary or Acquisition Subsidiary, the approval, adoption or recommendation,
as the case may be, of the Transactions, this Agreement or any of the other
transactions contemplated hereby, (ii) approve or recommend, or propose to
approve or recommend, any Acquisition Proposal, (iii) cause the Company to
accept such Acquisition Proposal and/or enter into any Acquisition Agreement,
or (iv) resolve to do any of the foregoing; provided, that the Board of
Directors of the Company may withdraw, modify or amend such recommendation
prior to obtaining the approval of the Company Stockholders contemplated by
Section 6.5 if (w) the Company has complied with its obligations under this
Section 6.3, (x) the Board of Directors of the Company reasonably determines in
good faith, after consultation with outside nationally recognized legal counsel
(which may be its current outside legal counsel), that failure to take such
actions would be inconsistent with its fiduciary duties under applicable law
and (z) prior to taking such actions, the Board of Directors of the Company
shall have given Parent at least 48 hours notice of its intention to take such
action and the opportunity to meet with the Company and its outside counsel and
financial advisor.  Any such withdrawal,
modification or change shall not change the approval of the Board of Directors
of the Company for purposes of causing any state takeover statute or other
similar law to be inapplicable to the Transactions.  During the term of this Agreement, nothing contained in this
Section 6.3(b) shall limit the Company’s obligation to hold and convene the meeting
of the Company’s Stockholders referred to in Section 6.5 and to submit this
Agreement and the Transactions for adoption and approval by the Company
Stockholders (including, without limitation, regardless of whether the
recommendation of the Board of Directors of the Company of this Agreement or
the Transactions shall have been withdrawn or modified).


 


51

















 


(c)           In addition to the obligations of the
Company set forth in Section 6.3(a), the Company shall as promptly as
practicable (and in any event within 24 hours) advise Parent of any request for
information with respect to any Acquisition Proposal or of any Acquisition
Proposal, or any inquiry, proposal, discussions or negotiation with respect to
any Acquisition Proposal, the terms and conditions of such request, Acquisition
Proposal, inquiry, proposal, discussion or negotiation and the Company shall,
within 24 hours of the receipt thereof, promptly provide to Parent copies of
any written materials received by the Company in connection with any of the
foregoing, and the identity of the Person making any such Acquisition Proposal
or such request, inquiry or proposal or with whom any discussions or
negotiations are taking place.  The
Company shall keep Parent fully informed of the status and material details
(including amendments or proposed amendments) of any such request or
Acquisition Proposal and keep Parent fully informed as to the material details
of any information requested of or provided by the Company and as to the
details of all discussions or negotiations with respect to any such request,
Acquisition Proposal, inquiry or proposal, and shall provide to Parent within
24 hours of receipt thereof all written materials received by the Company with
respect thereto.  The Company shall
promptly provide to Parent any non-public information concerning the Company
provided to any other Person in connection with any Acquisition Proposal, which
was not previously provided to Parent. 
If an event that is not caused by the Company, its Subsidiaries or any
of their Affiliates or Representatives occurs which prevents the Company from
complying with the timing of the information delivery requirements set forth in
this Section 6.3(c), the Company shall not be deemed to be in violation of this
Section 6.3(c) provided that (i) the Company acts reasonably and in good faith
to supply the required information as soon as possible and (ii) such delay in
the receipt of information does not adversely affect Parent in any material
respect.


 


(d)           Nothing contained in this Section 6.3
shall prohibit the Board of Directors of the Company nor any committee thereof
from (i) making and disclosing to the Company Stockholders a position
contemplated by Rule 14d-9 or Rule 14e-2(a) promulgated under the Exchange Act
or (ii) making any disclosure to the Company Stockholders if the Board of
Directors of the Company determines in good faith, after consultation with
outside nationally-recognized legal counsel (which may be its current outside
legal counsel), that failure to make such disclosure pursuant to this clause
(ii) would be inconsistent with its fiduciary duties under applicable law.


 


(e)           The Company shall promptly (and in
any event within three Business Days following the date hereof) request in
writing each Person which has heretofore executed a confidentiality agreement
in connection with its consideration of acquiring the Company or any portion
thereof to return all confidential information heretofore furnished to such
Person by or on behalf of the Company, and the Company shall use its best
efforts to have such information returned or destroyed (to the extent
destruction of such information is permitted by such confidentiality
agreement).


 


Section
6.4.            Access to Information.  The Company shall (and shall cause each of
its Subsidiaries to) afford to Parent and its Representatives reasonable
access, upon reasonable advance notice, during normal business hours during the
period prior to the Effective Time, to all of the properties, books, contracts,
commitments, personnel and records and accountants of the Company and its
Subsidiaries and, during such period, the Company shall (and shall cause each


 


52

















 


of its
Subsidiaries to) furnish to Parent (a) a copy of each report, schedule, registration
statement and other document filed or received by it or any of its Subsidiaries
during such period pursuant to the requirements of federal or state securities
laws and (b) all other information concerning the business, properties, assets
and personnel of the Company and its Subsidiaries as Parent may reasonably
request.  Parent, Merger Subsidiary,
Acquisition Subsidiary and their Affiliates and Representatives will hold any
such information that is nonpublic in confidence in accordance with the
Confidentiality Agreement.  No
information or knowledge obtained in any investigation pursuant to this Section
6.4 or otherwise shall affect or be deemed to modify any representation or
warranty contained in this Agreement or the conditions to the obligations of
the Parties to consummate the Transactions.


 


Section
6.5.            Special Meeting.  As promptly as practicable after the execution and delivery of
this Agreement, the Company, acting through its Board of Directors, shall, in
accordance with applicable law, duly call, give notice of, convene and hold the
Special Meeting, which meeting shall be held as promptly as practicable
following the preparation and mailing of the Proxy Statement, and the Company
agrees that this Agreement and the Transactions shall be submitted at such
meeting for adoption and approval by the Company Stockholders.  The Proxy Statement shall provide for
separate votes by Company Stockholders on the Merger and the Asset Purchase,
but shall also provide that neither shall be deemed to be approved unless both
are approved by the requisite vote of the Company Stockholders.  Subject to Section 6.3(b), the Company shall
use its reasonable best efforts to solicit and obtain from the Company
Stockholders proxies, and shall take all other action necessary and advisable
to secure the vote of the Company Stockholders required by applicable law and
by the Amended and Restated Certificate of Incorporation, as amended, or the
By-laws of the Company to obtain their adoption of this Agreement and approval
of the Transactions, and, subject to Section 6.3(b), the Board of Directors of
the Company shall recommend that the Company Stockholders vote in favor of the
adoption of this Agreement and the approval of the Transactions at the Special
Meeting and the Company agrees that it shall include in the Proxy Statement
such recommendation of the Board of Directors of the Company that the Company
Stockholders adopt this Agreement and approve the Transactions.  Without limiting the generality of the
foregoing, the Company agrees that its obligations pursuant to the first
sentence of this Section 6.5 during the term of this Agreement shall not be
affected by (a) the commencement, public proposal, public disclosure or
communication to the Company, any of its Subsidiaries or any of their
respective Affiliates (or any of their respective Representatives) of any
Acquisition Proposal or (b) the withdrawal or modification by the Board of
Directors of the Company of its recommendation of this Agreement or the
Transactions.


 


Section
6.6.            Proxy Statement.  As promptly as practicable after the execution and delivery of
this Agreement, the Company shall:


 


(a)           prepare and, after consultation with
and review by Parent and its outside counsel, file with the SEC a preliminary
proxy statement relating to the Transactions and this Agreement and use its
reasonable best efforts (i) to obtain and furnish the information required to
be included by the SEC in the Proxy Statement and, after consultation with and
review by Parent, to respond promptly to any comments made by the SEC with
respect to the preliminary proxy statement and promptly cause the Proxy
Statement to be mailed to its stockholders and, if necessary, after the Proxy
Statement shall have been so mailed, promptly circulate amended or 


 


53

















 


supplemental
proxy material and, if required in connection therewith, resolicit proxies; provided,
that no such amended or supplemental proxy material will be mailed by the
Company without consultation with and review by Parent and its outside counsel
(which review shall not be unreasonably delayed) and (ii), subject to Section
6.3(b), to obtain the necessary approvals of this Agreement and the
Transactions by its stockholders;


 


(b)           promptly notify Parent of the receipt
of the comments of the SEC and of any request from the SEC for amendments or
supplements to the preliminary proxy statement or the Proxy Statement or for
additional information, and will promptly supply Parent and its outside counsel
with copies of all written correspondence between the Company or its
representatives, on the one hand, and the SEC or members of its staff, on the
other hand, with respect to the preliminary proxy statement, the Proxy
Statement or the Transactions;


 


(c)           promptly inform Parent and its
outside counsel if at any time prior to the Special Meeting any event should
occur that is required by applicable law to be set forth in an amendment of, or
a supplement to, the Proxy Statement, in which case, the Company, with the
cooperation and approval of and in consultation with Parent and its outside
counsel, will, upon learning of such event, promptly prepare and mail such
amendment or supplement; and


 


(d)           it is expressly understood and agreed
that (i) Parent, Merger Subsidiary, Acquisition Subsidiary and the Company will
cooperate with each other in connection with all aspects of the preparation,
filing and clearance by the SEC of the Proxy Statement (including the
preliminary proxy statement and any and all amendments or supplements thereto),
(ii) the Company shall give Parent and its outside counsel the opportunity to
review and comment on the Proxy Statement prior to it being filed with the SEC
and shall give Parent and its outside counsel the opportunity to review and
comment on all amendments and supplements to the Proxy Statement and all
responses to requests for additional information and replies to comments prior
to their being filed with, or sent to, the SEC and each of the Company and
Parent agrees to use its reasonable best efforts, after consultation with the
other, to respond promptly to all such comments of and requests by the SEC and
(iii) the Company shall promptly inform Parent and its counsel of the content
of all communications with the SEC and its staff relating to the Proxy
Statement, this Agreement or the transactions contemplated hereby.


 


Section
6.7.            Cooperation. 
Subject to the terms and conditions provided herein, each of the
Company, Parent, Merger Subsidiary and Acquisition Subsidiary shall, and the
Company shall cause each of its Subsidiaries to, cooperate and use their
reasonable best efforts to take, or cause to be taken, all appropriate action,
and do, or cause to be done, and assist and cooperate with the other Parties in
doing, all things necessary, proper or advisable to consummate and make
effective, in the most expeditious manner practicable, the Transactions
(including the satisfaction of the respective conditions set forth in Article
VII), and to make, or cause to be made, all filings necessary, proper or
advisable under applicable Laws, rules and regulations to consummate and make
effective the transactions contemplated by this Agreement.  Without limiting the generality of the
foregoing, each of the Company, Parent, Merger Subsidiary and Acquisition
Subsidiary shall, and the Company shall cause each of its Subsidiaries to,
cooperate and use their reasonable best efforts to promptly:


 


54

















 


(a)           make any and all filings,
recordations, declarations or registrations with, obtain any and all actions or
non-actions, licenses, permits, consents, approvals, waivers, authorizations,
qualifications and orders of, give any and all notices to, take reasonable
steps to avoid an Action or Proceeding by, any and all Governmental Entities
and parties to contracts with the Company and its Subsidiaries, in each case
prior to the Closing Date, as are necessary, proper or advisable to consummate
and make effective, in the most expeditious manner practicable, the
Transactions; it being understood and agreed that:


 


(i)            the Company and its Subsidiaries
shall use their reasonable best efforts to cooperate with Parent in any manner
reasonably requested by Parent in connection with obtaining at or prior to the
Closing all Required Merger Consents (no such Required Merger Consent to be
conditioned on any increase in the amount payable under the applicable Company
Material Contract or any reduction in the term thereof or any other material
changes in the provisions thereof, except as may be required by the express
terms of the applicable Company Material Contract, and such Required Merger
Consent shall otherwise be on terms and conditions reasonably satisfactory to
Parent); in connection with the foregoing, neither the Company nor any of its
Subsidiaries shall, without the prior written consent of Parent, make (or
commit to make) any payment or otherwise provide (or commit to provide) any
value or benefit to any Person in connection with obtaining any Required Merger
Consent (except as may be required by the express terms of the respective
Company Material Contracts);


 


(ii)           the Company and its Subsidiaries
shall use their commercially reasonable efforts to cooperate with Parent in any
manner reasonably requested by Parent in connection with obtaining at or prior
to the Closing any Required Asset Consents (no such Required Asset Consent to
be conditioned on any increase in the amount payable under the applicable
Company Material Contract or any reduction in the term thereof or any other
material changes in the provisions thereof, except as may be required by the
express terms of the applicable Company Material Contract, and such Required
Asset Consent shall otherwise be on terms and conditions reasonably
satisfactory to Parent); in connection with the foregoing, neither the Company
nor any of its Subsidiaries shall, without the prior written consent of Parent,
make (or commit to make) any payment or otherwise provide (or commit to
provide) any value or benefit to any Person in connection with obtaining any
Required Asset Consent (except as may be required by the express terms of the
respective Company Material Contracts); provided, to obligate or require
the Company or its Subsidiaries to obtain any consent, approval or waiver in
connection with the Asset Purchase;


 


(iii)          each of the Parties shall
expeditiously give and make any and all notices and reports required to be made
by such Party to the appropriate Persons with respect to Company Permits and
each of the Parties shall, prior to the Effective Time, use its reasonable best
efforts to cooperate with the other in any manner reasonably requested by the
other in connection with obtaining at or prior to the Closing the regulatory
approvals or consents as may be required by any Governmental Entities in order
to obtain and maintain in effect at all times following the Effective Time all
Company Permits and other Governmental Approvals necessary to maintain
continuity of its relationships with all customers and clients; without limiting
the foregoing, each of the Parties shall, to the extent necessary of such
Party, (A) duly and promptly file and process any and all applications
necessary to obtain all required regulatory approvals or consents as a result
of the consummation of the transactions contemplated by this Agreement, 


 


55

















 


including the
amendment of any and all documents required to be amended with respect to the
existing licensees under the Company Permits and (B) duly and promptly file
with all appropriate Governmental Entities, and thereafter duly process renewal
applications for all of the Company’s licensed Subsidiaries whose licenses will
expire during the period from the date of this Agreement and until all of the
respective applications shall have been approved; and


 


(iv)          the Company and its Board of Directors
shall, if any “fair price”, “moratorium”, “control share acquisition”,
“business combination” or other state takeover statute or similar statute, rule
or regulation becomes applicable to this Agreement or the Transactions, take
all action within its power to ensure that the Transactions may be consummated
as promptly as practicable on the terms contemplated by this Agreement and
otherwise to minimize the effect of such statute, rule or regulation on the
Transactions;


 


(b)           defend any lawsuits or other legal
proceedings, whether judicial or administrative, challenging this Agreement or
the consummation of any of the Transactions (including seeking to have any stay
or temporary restraining order entered by any court or other Governmental
Entity vacated or reversed); it being understood and agreed that the Company
shall promptly notify Parent of any litigation or threatened litigation
(including any stockholder litigation), other than where Parent is the adverse
party, against the Company and/or its directors relating to any of the
transactions contemplated by this Agreement and the Company shall give Parent
the opportunity to participate, in the defense or settlement of any such
litigation; provided, that no settlement with respect to any such
litigation shall be agreed to without Parent’s prior consent (not to be
unreasonably withheld or delayed); and


 


(c)           execute and deliver any additional
instruments necessary to consummate the Transactions and to fully carry out the
purposes of this Agreement.


 


Section
6.8.            Public Disclosure.  The press release announcing the execution
of this Agreement shall be issued only in such form as shall be mutually agreed
upon by the Company and Parent and each of the Company and Parent shall consult
with, and obtain the consent of, the other Party (which shall not be
unreasonably withheld or delayed) before issuing any other press release or
otherwise making any public statement with respect to the Merger or this
Agreement and shall not issue any such press release or make any such public
statement prior to consulting with and obtaining the prior consent of the other
Party (which shall not be unreasonably withheld or delayed); provided,
that a Party may, without consulting with or obtaining the prior consent of the
other Party, issue such press release or make such public statement as may be
required by applicable Law or by any listing agreement with a national
securities exchange or automated quotation system to which Parent (or an
Affiliate thereof) or the Company, as the case may be, is a party, if such
Party has used reasonable best efforts to consult with the other Party and to
obtain such other Party’s consent, but has been unable to do so in a timely
manner.


 


Section
6.9.            Notification of Certain Matters.  The Company shall give prompt notice to
Parent and Parent shall give prompt written notice to the Company, of (a) the
occurrence or non-occurrence of any event known to such Party, the occurrence
or non-occurrence of which has resulted in, or is reasonably likely to result
in, any representation or warranty set forth in this Agreement made by such
Party to be untrue or inaccurate (taking into 


 


56

















 


account any
materiality qualification, to the extent applicable); (b) any material failure
by such Party to comply with or satisfy any covenant, condition or agreement to
be complied with or satisfied by it hereunder; or (c) any action, suit, proceeding,
inquiry or investigation pending or, to the knowledge of such Party, threatened
which questions or challenges or relates to this Agreement or the consummation
of any of the transactions contemplated hereby; provided, that the
delivery of any notice pursuant to this Section 6.9 shall not limit or
otherwise affect the remedies available hereunder to the Party receiving such
notice and that no such notification shall modify the representations or
warranties of any Party or the conditions to the obligations of any Party
hereunder.  Each of the Company, Parent,
Merger Subsidiary or Acquisition Subsidiary shall give prompt notice to the
other Parties of any written notice from any third party alleging that the consent
of such third party is or may be required in connection with the transactions
contemplated by this Agreement.


 


Section
6.10.          Rights Agreement.  During the term of this Agreement and prior to the Effective
Time, the Company shall not, without the prior written consent of the Parent,
unless required to do so by a court of competent jurisdiction (i) redeem or
exchange the Rights, (ii) amend (other than, subject to the following clause
(iii), to defer the “Distribution Date” (as such term is defined in the Rights
Agreement) in the case of commencement of a tender or exchange offer (but not
in the case of any purchase of Company Common Stock pursuant to such tender or
exchange offer) that would otherwise trigger a “Distribution Date” pursuant to
Section 3(a)(ii) of the Rights Agreement) or terminate the Rights Agreement or
(iii) take any action which would allow any “Person” (as such term is defined
in the Rights Agreement) other than Parent, Merger Subsidiary or Acquisition
Subsidiary (or their Affiliates) to be the “Beneficial Owner” (as such term is
defined in the Rights Agreement) of fifteen percent or more of the Company
Common Stock without causing a “Distribution Date” or a “Share Acquisition
Date” (as such term is defined in the Rights Agreement) to occur.


 


Section
6.11.          Subsequent Filings.  Until the Effective Time, the Company will
timely file with the SEC each Subsequent Filing required to be filed by the
Company and will promptly deliver to Parent, Merger Subsidiary and Acquisition
Subsidiary copies of each such Subsequent Filing filed with the SEC.  Each of the audited consolidated financial
statements and unaudited interim financial statements (including, in each case,
any related notes and schedules) contained or to be contained in the Subsequent
Filings shall be prepared from, and shall be in accordance with, the books and
records of the Company and its consolidated Subsidiaries, shall comply in all
material respects with applicable accounting requirements and with the
published rules and regulations of the SEC with respect thereto, shall be
prepared in accordance with GAAP (except as may be indicated in the notes
thereto) and shall fairly present the consolidated financial position and the
consolidated results of operations and cash flows of the Company and its
consolidated Subsidiaries at the dates and for the periods covered thereby.


 


Section
6.12.          Communication to Employees.  The Company and Parent will cooperate with
each other with respect to, and endeavor in good faith to agree in advance upon
the method and content of, all written or oral communications or disclosure to
employees of the Company or any of its Subsidiaries with respect to the
Transactions.


 


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Section
6.13.          Indemnification of Officers and
Directors; Exculpation.


 


(a)           Parent and the Surviving Corporation
agree that the indemnification obligations set forth in the Company Amended and
Restated Certificate of Incorporation, as amended, and the Company By-laws
shall survive the Merger (and, prior to the Effective Time, Parent shall cause
the Certificate of Incorporation and By-laws of Merger Sub to reflect such
provisions) and shall not be amended, repealed or otherwise modified for a
period of six years after the Effective Time in any manner that would adversely
affect the rights thereunder of any individual who on or prior to the Effective
Time was a director, officer, trustee, fiduciary, employee or agent of the
Company or any Company Subsidiary or who served at the request of the Company
or any Company Subsidiary as a director, officer, trustee, partner, fiduciary,
employee or agent of another corporation, partnership, joint venture, trust,
pension or other employee benefit plan or enterprise, unless such amendment or
modification is required by Law.


 


(b)           The Surviving Corporation shall
obtain a prepaid insurance and indemnification policy covering the Company’s
current directors and officers for a period of six years from the Effective
Time that provides coverage for events occurring prior to the Effective Time (the
“D&O Insurance”) that is no
less favorable than the Company’s existing policy (true and complete copies
which have been previously provided to Parent) or, if substantially equivalent
insurance coverage is unavailable, the best available coverage; provided,
however, that the Surviving Corporation shall not be required to expend
a premium in excess of $1 million for such D&O Insurance.  Parent shall, and shall cause the Surviving
Corporation to, maintain such policies in full force and effect, and continue to
honor the obligations thereunder.  The
obligations under this Section 6.13 shall not be terminated or modified in such
a manner as to adversely affect any indemnitee to whom this Section 6.13
applies without the consent of such affected indemnitee (it being expressly
agreed that the indemnitees to whom this Section 6.13 applies shall be third
party beneficiaries of this Section 6.13).


 


(c)           In the event Parent or the Surviving
Corporation (i) consolidates with or merges into any other person and shall not
be the continuing or surviving corporation or entity of such consolidation or
merger or (ii) transfers all or substantially all of its properties and assets
to any person, then, and in each such case, proper provisions shall be made so
that such continuing or surviving corporation or entity or transferee of such
assets, as the case may be, shall assume the obligations set forth in this
Section 6.13.


 


(d)           The provisions of this Section 6.13
are intended to be in addition to the rights otherwise available to the current
officers and directors of the Company by law, charter, statute, bylaw or
agreement, and shall operate for the benefit of, and shall be enforceable by,
each of the Indemnified Parties, their heirs and their representatives.


 


Section
6.14.          Employee Benefits.  Parent shall take all action necessary and
appropriate to ensure that, following the Effective Time, Parent or the
Surviving Corporation provides, or causes to be provided, compensation,
vacation and leave, and employee benefit plans, programs, policies and
arrangements (including medical, dental, vision, accident, life, disability and
other employee welfare benefits) to those employees of the Company who will be
retained by the Surviving Corporation following the Effective Time (the “Retained Employees”) that are substantially
the same as those made available to similarly situated 


 


58

















 


employees of
Parent; provided, however, that any Retained Employee whose
employment is terminated by Parent or the Surviving Corporation during the 90 -
day period following the Effective Time shall receive severance benefits at
least equal to the severance benefits that would have been provided by the
Company as of the date hereof under the Company’s severance plans described in
Section 4.15(a).  Retained Employees
shall be provided credit by Parent or the Surviving Corporation for all service
with the Company, to the same extent as such service was credited for such purpose
by the Company, under (x) all Company Benefit Plans for purposes of
eligibility, vesting and benefit accrual under Parent’s Benefit Plans, and (y)
severance plans, programs and policies for purposes of calculating the amount
of each such employee’s severance benefits under Parent’s Benefit Plans.  The Surviving Corporation shall give credit
to each Retained Employee for earned but unused vacation and accrued
vacation.  From and after the Effective
Time, Parent or the Surviving Corporation shall (i) cause any pre-existing
conditions or limitations and eligibility waiting periods (to the extent that
such waiting periods would be applicable) under any group health plan of the
Surviving Corporation to be waived with respect to Retained Employees and their
dependents and (ii) give each Retained Employees credit for the plan year in
which the Effective Time occurs towards applicable deductibles and annual
out-of-pocket limits for medical expenses incurred prior to the Effective Time
for which payment has been made.


 


Section 6.15.          Executive Agreements.  Parent shall cause the Surviving Corporation
to honor and perform the Executive Agreements in accordance with their terms.


 


ARTICLE VII


 


CONDITIONS TO EFFECT THE MERGER


 


Section
7.1.            Conditions to Each Party’s
Obligation to Effect the Transactions.  The respective obligations of each Party to this Agreement to
effect the Transactions shall be subject to the satisfaction or waiver (to the
extent permitted by applicable law) on or prior to the Closing Date of each of
the following conditions:


 


(a)           Stockholder Approval.  This Agreement, the Merger and the Asset
Sale shall have each been duly adopted and approved by the requisite
affirmative vote of the Company Stockholders in accordance with applicable law,
the Company’s Amended and Restated Certificate of Incorporation, as amended,
and By-laws.


 


(b)           Governmental Approvals.  Other than the filing of the Certificate of
Merger and all other filings or recordings required under the DGCL as
contemplated by Section 2.2, all authorizations, consents, orders or approvals
of, or declarations or filings with, or expirations of waiting periods imposed
by, any Governmental Entity in connection with the Transactions, the failure of
which to file, obtain or occur, individually or in the aggregate, would make
the consummation of the Transactions illegal or result or would reasonably be
likely to result in a Company Material Adverse Effect, shall have been filed,
been obtained or occurred and shall not have expired or been withdrawn; provided,
that the right to assert this condition shall not be available to a Party whose
material failure to fulfill any obligation under this Agreement has been the
principal cause of or resulted in the failure of this condition to be
satisfied.


 


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(c)           No Restraints.  There shall be no preliminary or permanent
order or injunction of a court or other Governmental Entity of competent
jurisdiction precluding, restraining, enjoining or prohibiting consummation of
the Transactions, and there shall not be instituted, pending or threatened in
writing any Action or Proceeding by any Governmental Entity seeking to
preclude, restrain, enjoin or prohibit consummation of the Transactions.


 


(d)           Illegality.  There shall have been no action taken, or
statute, rule, regulation, judgment or executive order promulgated, entered,
enforced, enacted, issued or deemed applicable to the Transactions by any
Governmental Entity that directly or indirectly prohibits or makes illegal the
consummation of the Transactions.


 


Section
7.2.            Conditions to Parent’s, Merger
Subsidiary’s and Acquisition Subsidiary’s Obligation to Effect the
Transactions.  The obligation of
Parent, Merger Subsidiary and Acquisition Subsidiary to effect the Transactions
shall be subject to the satisfaction on or prior to the Closing Date of each of
the following conditions, any and all of which may be waived in whole or in
part by Parent or Merger Subsidiary, Acquisition Subsidiary to the extent
permitted by applicable law:


 


(a)           Performance of Obligations;
Representations and Warranties.  (i)
The Company shall have performed in all material respects each of its covenants
and agreements contained in this Agreement required to be performed at or prior
to the Effective Time, (ii) (x) each of the representations and warranties of
the Company contained in this Agreement (other than the representations and
warranties of the Company identified in subsection (y)) shall be true and
correct in all material respects (except that those representations and warranties
which address matters only as of a particular date need only be true and
correct in all material respect as of such date and to the extent that the
representations and warranties contained in Section 4.8 that are qualified by
any reference to materiality shall be true and correct in all respects) and (y)
each of the representations and warranties of the Company contained in Section
4.4(b), (c) and (d), the last paragraph of Section 4.12, Section 4.13, Section
4.16 and Section 4.18 shall be true and correct, such that the aggregate effect
of any breaches of or inaccuracies in such representations and warranties do
not comprise a Company Material Adverse Effect on and as of the Effective Time
as if made on and as of such date (it being agreed that for purposes of this
subsection (y), such representations and warranties shall be deemed not
qualified by any reference to materiality generally or whether or not any
breach could result or could reasonably be expected to result in a Company
Material Adverse Effect), and (iii) Parent shall have received a certificate
signed on behalf of the Company by its Chief Executive Officer or its Chief
Financial Officer to such effect.


 


(b)           Ancillary Agreements.  Each of the Ancillary Agreements to which
the Company is or will be a party shall be valid, in full force and effect, and
the Company shall have complied with each Ancillary Agreement and all material
respects.


 


(c)           No Litigation.  No requirement of Law shall have been
issued, enacted, enabled, promulgated or enforced by any Government Entity
which would have materially reduced the benefits of the transactions
contemplated hereby to Parent or the Surviving Corporation in a manner that
Parent, in its good faith reasonable judgment, would not have entered into this
Agreement had such condition or requirement been known on the date hereof.


 


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(d)           Company Material Adverse Effect.  There shall not have occurred any event
having or resulting in, or which could reasonably be expected to result in, a
Company Material Adverse Effect.  The
Company shall have delivered to Parent and Merger Subsidiary a certificate,
signed on behalf of the Company by the Chief Executive Officer of the Company, to
such effect.


 


(e)           Consents.  The Company shall have obtained each consent
or approval described in Section 7.2(e) of the Company Disclosure Letter.


 


(f)            Resignations.  All of the directors of the Company and its
Subsidiaries in office immediately prior to the Effective Time shall have
provided executed, undated forms of resignation, which shall not have been
revoked, from their positions as directors of the Company and each of its
Subsidiaries as applicable.


 


Section
7.3.            Conditions to the Company’s
Obligation to Effect the Transactions.  The obligation of the Company to effect the Merger shall be
subject to the satisfaction on or prior to the Closing Date of each of the
following conditions, any and all of which may be waived in whole or in part by
the Company, to the extent permitted by applicable law:


 


(a)           Performance of Obligations;
Representations and Warranties.  (i)
Each of Parent, Acquisition Subsidiary and Merger Subsidiary shall have
performed in all material respects each of their respective agreements
contained in this Agreement required to be performed on or prior to the
Effective Time, (ii) each of the representations and warranties of Parent,
Acquisition Subsidiary and Merger Subsidiary contained in this Agreement shall
be true and correct, such that the aggregate effect of any inaccuracies in such
representations and warranties will not have a material adverse effect on the
ability of Parent, Acquisition Subsidiary or Merger Subsidiary to duly perform
their respective obligations under this Agreement or to consummate the transactions
contemplated hereby on a timely basis on and as of the Effective Time as if
made on and as of such date (other than representations and warranties which
address matters only as of a certain date which shall be true and correct as of
such certain date and except as contemplated or permitted by this Agreement),
without regard for purposes of this Section 7.3(a) to any materiality
qualifications contained in such representations and warranties and (iii) the
Company shall have received a certificate signed on behalf of Parent, Merger
Subsidiary and Acquisition Subsidiary by an officer thereof to such effect.


 


(b)           Ancillary Agreements.  Each of the Ancillary Agreements to which
Parent, Acquisition Subsidiary and/or Merger Subsidiary is or will be a Party
shall be valid, in full force and effect, and Parent and/or Merger Subsidiary
as the case may be, shall have complied with each Ancillary Agreement in all
material respects.


 


(c)           Asset Purchase.  The obligation of the Company to effect the
Merger shall be subject to, and conditioned upon, the closing of the Asset
Purchase pursuant to Section 2.4.


 


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ARTICLE VIII


 


TERMINATION


 


Section
8.1.            Termination. 
This Agreement may be terminated and the Transactions may be abandoned
at any time prior to the Effective Time, by written notice by the terminating
Party to the other Parties, whether before or after Company Stockholder
approval thereof, as follows:


 


(a)           by mutual written consent duly
authorized by the Boards of Directors of Parent and the Company;


 


(b)           by either Parent or the Company, if
the Transactions shall not have been consummated on or prior to 180 days after
the signing of this Agreement (or such later date as may be agreed to in
writing by Parent and the Company) (as the same may be extended from time to
time as contemplated below, the “Termination
Date”), unless the Transactions shall not have been consummated
because of a material breach of any representation, warranty, obligation,
covenant or agreement set forth in this Agreement on the part of the Party
seeking to terminate this Agreement;


 


(c)           by either Parent or the Company, if a
Governmental Entity or court of competent jurisdiction shall have issued a
nonappealable final order, decree or ruling or taken any other nonappealable
final action, in each case having the effect of permanently restraining,
enjoining or otherwise prohibiting the Transactions (provided, that the
right to terminate this Agreement under this Section 8.1(c) shall not be
available to any Party whose material failure to fulfill any obligation under
this Agreement has been the principal cause of or resulted in such order,
decree ruling or action);


 


(d)           by either Parent or the Company, if
at the Special Meeting (including any adjournment or postponement thereof
permitted by this Agreement), the requisite vote of the stockholders of the
Company approving each of this Agreement, the Merger and the Asset Purchase
shall not have been obtained upon votes taken thereon;


 


(e)           by Parent, if (i) the Company shall
have (A) withdrawn, modified or amended, or proposed to withdraw, modify or
amend, in a manner adverse to Parent or Merger Subsidiary, the approval,
adoption or recommendation, as the case may be, of this Agreement or any of the
Transactions or (B) approved or recommended, or proposed to approve or
recommend, or entered into any agreement, arrangement or understanding with
respect to, any Acquisition Proposal; (ii) the Company’s Board of Directors or
any committee thereof shall have resolved to take any of the actions set forth
in preceding subclause (i); (iii) if after an Acquisition Proposal has been
made, the Board of Directors of the Company fails to affirm its recommendation
and approval of this Agreement and the Transactions within three Business Days
of any request by Parent to do so; or (iv) if a tender offer or exchange offer
constituting an Acquisition Proposal is commenced and the Board of Directors of
the Company does not recommend against acceptance of such offer by the Company
Stockholders (including by taking no position or a neutral position with
respect thereto);


 


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(f)            by the Company, if a Superior
Proposal is received by the Company and the Board of Directors of the Company
reasonably determines in good faith, after consultation with outside nationally
recognized legal counsel (which may be its current outside legal counsel), that
it is necessary to terminate this Agreement and enter into an agreement to
effect the Superior Proposal in order to comply with its fiduciary duties under
applicable law; provided, that the Company may not terminate this
Agreement pursuant to this Section 8.1(f) unless the Company has complied with
its obligations under Section 6.3 and until (x) two Business Days have elapsed
following delivery to Parent of a written notice of such determination by the
Board of Directors of the Company and during such two Business Day period the
Company has fully cooperated with Parent (including informing Parent of the
terms and conditions of such Superior Proposal and the identity of the Person
making such Superior Proposal) with the intent of enabling the Parties to agree
to a modification of the terms and conditions of this Agreement so that the
transactions contemplated hereby may be effected on such adjusted terms, (y) at
the end of such two Business Day period, the Acquisition Proposal continues to
constitute a Superior Proposal, and the Board of Directors of the Company
continues to reasonably determine in good faith, after consultation with
outside nationally recognized legal counsel (which may be its current outside
legal counsel), that it is necessary to terminate this Agreement and enter into
an agreement to effect the Superior Proposal in order to comply with its
fiduciary duties under applicable law and (z) (A) prior to such termination,
Parent has received all fees and expense reimbursements set forth in Section
8.3 by wire transfer in same day funds and (B) simultaneously or substantially
simultaneously with such termination the Company enters into a definitive
acquisition, merger or similar agreement to effect the Superior Proposal;


 


(g)           by Parent, if there shall have been a
breach by the Company of any provision of Section 6.3;


 


(h)           by Parent, if there has been a breach
of or failure to perform any representation, warranty, covenant or agreement on
the part of the Company set forth in this Agreement, which breach or failure to
perform (i) would cause the conditions set forth in Section 7.2(a) or 7.2(b)
not to be satisfied, and (ii) either cannot be cured or has not been cured
prior to the earlier of (x) the fifteenth calendar day following receipt by the
Company of written notice of such breach from Parent and (y) the Termination
Date; or


 


(i)            by the Company, if there has been a
breach of or failure to perform any representation, warranty, covenant or
agreement on the part of Parent or Merger Subsidiary set forth in this
Agreement, which breach or failure to perform (i) would cause the conditions
set forth in Section 7.3(a) or 7.3(b) not to be satisfied, and (ii) either
cannot be cured or has not been cured prior to the earlier of (x) the fifteenth
calendar day following receipt by Parent of written notice of such breach from
the Company and (y) the Termination Date.


 


The right of any Party to
terminate this Agreement pursuant to this Section 8.1 shall remain operative
and in full force and effect regardless of any investigation made by or on
behalf of any Party, any Person controlling any such Party or any of their
respective officers or directors, whether prior to or after the execution of
this Agreement.


 


Section
8.2.            Effect of Termination.  In the event of termination of this
Agreement as provided in Section 8.1, written notice thereof shall forthwith be
given to the other 


 


63

















 


Party or
Parties specifying the provision hereof pursuant to which such termination is
made, and this Agreement shall immediately become void and there shall be no
liability or obligation on the part of Parent, the Company, Merger Subsidiary,
Acquisition Subsidiary or their respective officers, directors, stockholders or
Affiliates; provided, that (i) any such termination shall not relieve
any Party from liability for any willful breach of this Agreement and (ii) the
provisions of Section 4.21, the provisos relating to amendment to or waivers of
confidentiality agreements set forth in Section 6.3(a), the provisions of
Sections 6.2, 6.8, this Section 8.2, Section 8.3 and Article IX and the
Confidentiality Agreement shall remain in full force and effect and survive any
termination of this Agreement.


 


Section
8.3.            Fees and Expenses.  (a) Except as set forth in this Section 8.3, all fees and
expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the Party incurring such fees and
expenses, whether or not the Merger is consummated; provided, however, that
Parent shall pay one-half of the expenses related to printing, filing and mailing
the Proxy Statement and all SEC and other regulatory filing fees incurred in
connection with the Proxy Statement if this Agreement is terminated pursuant to
Section 8.1(a), by Parent pursuant to Section 8.1(b) or by the Company pursuant
to Section 8.1(i).


 


(b)           Parent Expenses:  If this Agreement is terminated pursuant to
Section 8.1(d), 8.1(e), Section 8.1(f) or Section 8.1(h), then Parent shall be
entitled to receive from the Company a reimbursement for the reasonable,
documented out-of-pocket expenses of Parent and Merger Subsidiary and
Acquisition Subsidiary (including printing fees, filing fees and fees and
expenses of its legal and financial advisors) related to this Agreement and the
transactions contemplated hereby and any related financing, in an amount not to
exceed $250,000 (“Parent  Expense Reimbursement”).


 


(c)           Company Expenses:  If this Agreement is terminated pursuant to
Section 8.1(i), then the Company shall be entitled to receive from Parent a
reimbursement for the out-of-pocket expenses of the Company (including printing
fees, filing fees and fees and expenses of its legal and financial advisors)
related to this Agreement and the transactions contemplated hereby and any
related financing, in an amount not to exceed $250,000 (“Company  Expense
Reimbursement”).


 


(d)           Termination Fee.  (i) 
If this Agreement is terminated:


 


(1)           pursuant to Section 8.1(e), Section 8.1(f), Section 8.1(g)
or Section 8.1(h);


 


(2)           pursuant Section 8.1(d) provided that an Acquisition
Proposal (or an intention to make an Acquisition Proposal) has been made,
proposed, communicated or disclosed, after the date of this Agreement, in a
manner which is or otherwise becomes public (including being known to
unaffiliated stockholders of the Company) and not expressly and publicly
withdrawn prior to the Special Meeting; or


 


(3)           by the Company in accordance with Section 8.1(b) provided
that an Acquisition Proposal (or an intention to make an Acquisition Proposal) 


 


64

















 


has been made,
proposed, communicated or disclosed, after the date of this Agreement, and not
expressly withdrawn prior to such termination, and, within twelve months of
such termination, the Company enters into an agreement, arrangement or
understanding (including a letter of intent) with respect to or consummates any
Acquisition Proposal;


 


(ii)           then Parent shall be entitled to
receive from the Company, as liquidated damages and not as a penalty, an amount
equal to $500,000 (the “Termination Fee”)
and shall not be entitled to any other damages at law or any equitable relief
hereunder (except with respect to those sections that survive termination of
this Agreement).  Notwithstanding the
foregoing, nothing herein shall relieve any party from liability, or limit its liability,
for any willful breach or willful misrepresentation hereunder, or prevent any
party from asserting any equitable remedies available to it for such willful
breach or willful misrepresentation.


 


(e)           The Company and Parent acknowledges
that the Parent Expense Reimbursement, Company Expense Reimbursement and
Termination Fee provided for in this Section 8.3 are an integral part of the
transactions contemplated by this Agreement and not a penalty, and that,
without the Parent Expense Reimbursement, Company Expense Reimbursement and
Termination Fee provided for above, neither Parent, Merger Subsidiary nor
Company would enter into this Agreement.


 


Section
8.4.            Amendment. 
To the extent permitted by applicable law, this Agreement may be amended
by the Parties, by action taken or authorized by their respective Boards of
Directors, at any time before or after approval of the matters presented in
connection with the Transactions by the Company Stockholders; provided,
that after any such approval, no amendment shall be made that by law requires
further approval by such Company Stockholders without such further
approval.  This Agreement may not be
amended except by an instrument in writing signed on behalf of each of the
Parties.


 


Section
8.5.            Extension; Waiver.  At any time prior to the Effective Time, the Parties, by action
taken or authorized by their respective Boards of Directors, may, to the extent
legally allowed, (a) extend the time for the performance of any of the
obligations or other acts of the other Parties, (b) waive any inaccuracies in
the representations and warranties contained herein or in any document
delivered pursuant hereto and (c) waive compliance with any of the agreements
or conditions contained herein.  Any
agreement on the part of a Party to any such extension or waiver shall be valid
only if set forth in a written instrument signed on behalf of such Party.  The failure of any Party to assert any of
its rights under this Agreement or otherwise shall not constitute a waiver of
such rights.


 


ARTICLE IX


 


MISCELLANEOUS


 


Section
9.1.            Nonsurvival of Representations
and Warranties.  The
respective representations and warranties of the Company, on the one hand, and
each of Parent, Merger Subsidiary and Acquisition Subsidiary, on the other hand,
contained in this Agreement, any Ancillary Agreement or in any document,
certificate or instrument delivered prior to or at the 


 


65

















 


Closing shall not be deemed
waived or otherwise affected by any investigation made by any Party.  Each and every such representation and
warranty shall expire with, and be terminated and extinguished by, the Closing,
and thereafter none of the Company, Parent, Merger Subsidiary or Acquisition
Subsidiary shall be under any liability whatsoever with respect to any such
representation and warranty.  This
Section 10.1 shall have no effect upon any other obligations of the Parties,
whether to be performed before or after the Effective Time.


 


Section
9.2.            Notices.  All
notices, requests, claims and demands and other communications hereunder shall
be in writing and shall be deemed duly delivered (i) four Business Days after
being sent by registered or certified mail, return receipt requested, postage
prepaid, or (ii) one Business Day after being sent for next business day
delivery, fees prepaid, via a reputable nationwide overnight courier service,
in each case to the intended recipient as set forth below:


 


(a)           if to Parent, Merger Subsidiary or
Acquisition Subsidiary, to:


 


SSA Global
Technologies, Inc.


110 Sheppard
Avenue East


Suite 701


Attention:    Shelley
R. Isenberg


Telephone:  (416)
228-2242


Facsimile:     (416)
221-0994


 


with a copy
to:


 


Schulte Roth
& Zabel LLP

919 Third Avenue

New York, New York  10022


Attention:    Robert
B. Loper, Esq. 


Telephone:  (212)
756-2138


Facsimile:     (212)
593-5955


 


(b)           if to the Company, to:


 


Elevon, Inc.

303 Second Street, Three North

San Francisco, CA 94107


Attention:    Stanley
V. Vogler


Telephone:  (415)
243-2737


Facsimile:     (415)
281-1558


 


66

















 


with a copy
to:


 


Latham &
Watkins LLP

505 Montgomery Street

Suite 1900

San Francisco, CA 94111


Attention:        John
M. Newell, Esq.


Telephone:      (415)
391-0600


Facsimile:         (415)
395-8095


 


Any Party may give any notice
or other communication hereunder using any other means (including personal
delivery, messenger service, facsimile or ordinary mail), but no such notice or
other communication shall be deemed to have been duly given unless and until it
actually is received by the Party for whom it is intended.  Any Party may change the address to which
notices and other communications hereunder are to be delivered by giving the
other Parties to this Agreement notice in the manner herein set forth.


 


Section
9.3.            Entire Agreement.  This Agreement (including the Company Disclosure Letter and the
other documents and instruments referred to herein that are to be delivered at
the Closing), and the Confidentiality Agreement, constitutes the entire
agreement among the Parties and supersedes any prior understandings, agreements
or representations by or among the Parties, or any of them, written or oral,
with respect to the subject matter hereof.


 


Section
9.4.            No Third Party Beneficiaries.  Except for the provisions of Sections 6.13,
6.14 and 6.15, this Agreement is not intended, and shall not be deemed, to
confer any rights or remedies upon any Person other the Parties and their
respective successors and permitted assigns, to create any agreement of
employment with any Person or to otherwise create any third-party beneficiary
hereto.


 


Section
9.5.            Assignment. 
Neither this Agreement nor any of the rights, interests or obligations
under this Agreement may be assigned or delegated, in whole or in part, by
operation of law or otherwise by any of the Parties without the prior written
consent of the other Parties, and any such assignment without such prior
written consent shall be null and void, except that, prior to the approval of
this Agreement and the Transactions by the Company’s stockholders, Parent  may substitute any direct or indirect
wholly-owned subsidiary of Parent for Merger Subsidiary or Acquisition
Subsidiary without consent of the Company, and Parent may assign its rights and
obligations under this Agreement to a newly formed Affiliate of Parent; provided,
that Parent, Merger Subsidiary and/or Acquisition Subsidiary, as the case may
be, shall remain liable for all of its obligations under this Agreement.  Subject to the preceding sentence, this
Agreement will be binding upon, inure to the benefit of, and be enforceable by,
the Parties and their respective successors and assigns.


 


Section
9.6.            Interpretation.  When a reference is made in this Agreement to Sections, such
reference shall be to a Section of this Agreement unless otherwise indicated.  Whenever the words “include”, “includes” or
“including” are used in this Agreement they shall be deemed to be followed by
the words “without limitation”.


 


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Section
9.7.            Counterparts. 
This Agreement may be executed in two or more counterparts, all of which
shall be considered one and the same agreement and shall become effective when
two or more counterparts have been signed by each of the Parties and delivered
to the other Parties.


 


Section 9.8.            Severability. 
If any term, provision, agreement, covenant or restriction of this
Agreement is held by a court of competent jurisdiction or other authority to be
invalid, void or unenforceable, the remainder of the terms, provisions,
agreements, covenants and restrictions of this Agreement shall remain in full
force and effect and shall in no way be affected, impaired or invalidated so
long as the economic or legal substance of the transactions contemplated hereby
is not effected in any manner materially adverse to any Party.  Upon such a determination, the Parties shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the Parties as closely as possible in an acceptable manner in order
that the transactions contemplated hereby be consummated as originally
contemplated to the fullest extent possible.


 


Section
9.9.            Governing Law. 
This Agreement shall be governed by and construed in accordance with the
internal laws of the State of Delaware (without reference to its choice of law
rules).


 


Section
9.10.          Submission to Jurisdiction.  Each Party hereby irrevocably and
unconditionally agrees that any action, suit or proceeding, at Law or equity,
arising out of or relating to this Agreement or any agreements or transactions
contemplated hereby shall only be brought in any federal court of the State of
Delaware or any state court located in Delaware, and hereby irrevocably and
unconditionally expressly submits to the personal jurisdiction and venue of
such courts for the purposes thereof and hereby irrevocably and unconditionally
waives (by way of motion, as a defense or otherwise) any and all
jurisdictional, venue and convenience objections or defenses that such party
may have in such action, suit or proceeding. 
Each Party hereby irrevocably and unconditionally consents to the
service of process of any of the aforementioned courts.  Nothing herein contained shall be deemed to
affect the right of any Party to serve process in any manner permitted by Law
or commence legal proceedings or otherwise proceed against any other Party in
any other jurisdiction to enforce judgments obtained in any action, suit or
proceeding brought pursuant to this Section 9.10.


 


Section
9.11.          Remedies; Specific Performance.  The Parties acknowledge that money damages
would not be an adequate remedy at Law if any party fails to perform in any
material respect any of its obligations hereunder and accordingly agree that
each Party, in addition to any other remedy to which it may be entitled at Law or
in equity shall be entitled to seek to compel specific performance of the
obligations of any other Party under this Agreement, without the posting of any
bond, in accordance with the terms and conditions of this Agreement in any
court of the United States or any State thereof having jurisdiction, and if any
action should be brought in equity to enforce any of the provisions of this
Agreement, none of the Parties hereto shall raise the defense that there is an
adequate remedy at Law.  Except as set
forth in Section 8.3, no remedy shall be exclusive of any other remedy and all
available remedies shall be cumulative.


 


68

















 


Section
9.12.          Waiver of Jury Trial.  EACH OF PARENT, MERGER SUBSIDIARY,
ACQUISITION SUBSIDIARY AND THE COMPANY HEREBY IRREVOCABLY WAIVES ALL RIGHTS TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON
CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF PARENT, MERGER
SUBSIDIARY, ACQUISITION SUBSIDIARY OR THE COMPANY IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE AND ENFORCEMENT OF THIS AGREEMENT.


 


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69

















 


IN WITNESS
WHEREOF, each of the Parent, Merger Subsidiary, Acquisition Subsidiary and the
Company has caused this Agreement to be executed by its duly authorized officer
as of the date first written above.


 


 


	
   

  	
  SSA GLOBAL
  TECHNOLOGIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kirk
  Isaacson

  
	
   

  	
   

  	
  Name:

  	
  Kirk
  Isaacson

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SENECA
  MERGER SUBSIDIARY INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kirk
  Isaacson

  
	
   

  	
   

  	
  Name:

  	
  Kirk
  Isaacson

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SENECA
  ACQUISITION SUBSIDIARY INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kirk
  Isaacson

  
	
   

  	
   

  	
  Name:

  	
  Kirk
  Isaacson

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ELEVON, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Frank M.
  Richardson

  
	
   

  	
   

  	
  Name:

  	
  Frank M.
  Richardson

  
	
   

  	
   

  	
  Title:

  	
  Chief
  Executive Officer

  



 


Signature page to Merger Agreement